Reference no: EM132957962

Problem 1: Martin Company purchases a machine at the beginning of the year at a cost of $85,000. The machine is depreciated using the double-declining-balance method. The machine's useful life is estimated to be 4 years with a $7,000 salvage value. Depreciation expense in year 4 is:

Problem 2: Jasper makes a $30,000, 90-day, 6.0% cash loan to Clayborn Co. The amount of interest that Jasper will collect on the loan is: (Use 360 days a year.)

Problem 3: A company has $95,000 in outstanding accounts receivable and it uses the allowance method to account for uncollectible accounts. Experience suggests that 5% of outstanding receivables are uncollectible. The current balance (before adjustments) in the allowance for doubtful accounts is a(n) $850 debit. The journal entry to record the adjustment to the allowance account includes a debit to Bad Debts Expense for