Reference no: EM133087626

Questions -

Q1. On January 1, 2014, McMahan Company purchased equipment at a cost of $420,000. The equipment was estimated to have a useful life of 5 years and a salvage value of $60,000. McMahan uses the sum-of-the-years'-digits method of depreciation. What should the accumulated depreciation be at December 31, 2017?

Q2. On January 1, 2015, Mena Co. purchased a new machine for $2,000,000. The machine has an estimated useful life of 5 years and a salvage value of $200,000. Mena uses the double-declining-balance method of depreciation. The amount of depreciation expense for 2017 is?

Q3. On January 1, 2016, Gecho Corporation purchased computer equipment for $23,000. The equipment has an estimated useful life of 4 years and a salvage value of $400. Given this information, if Gecho uses the double-declining-balance method of depreciation and sells the equipment on December 31, 2017, for $250, it will have a?

Q4. Luray Company purchased a new $40,000 truck on January 1, 2017. The truck was expected to last 4 years and have no salvage value. During 2018, Loray's depreciation expense on the truck was $12,000. Which of the following depreciation methods is Loray Company using to depreciate the truck?

a. Sum-of-the-years'-digits

b. Double-declining-balance

c. 150-percent-declining balance

d. Straight-line

Q5. If the estimate of an asset's useful life is changed, then

a. depreciation expense for all past periods must be recalculated.

b. there is no change in the amount of depreciation expense recorded for future years.

c. only the depreciation expense in the remaining years is changed.

d. None of these are true

Q6. Shanahan Construction purchased a crane on January 1, 2015, for $102,750. At the time of purchase, the crane was estimated to have a life of 6 years and a residual value of $6,750. In 2017, Shanahan determined that the crane had a total useful life of 7 years and a residual value of $4,500. If Shanahan uses the straight-line method of depreciation, what will be the 2017 depreciation expense for the crane?