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Archy [21]
2 years ago
11

On January 1, Year 1, Raven Limo Service, Inc. paid $64,000 cash to purchase a limousine. The limo was expected to have a six ye

ar useful life and a $10,000 salvage value. On January 1, Year 5 the limo was sold for $30,000 cash. Assuming Raven uses straight-line depreciation, the Company would recognize a
Business
1 answer:
MAXImum [283]2 years ago
4 0

Assuming Raven uses straight-line depreciation, the Company would recognize a $2,000 gain.

<h3>What is straight-line depreciation?</h3>

The simplest way to determine depreciation over time is through straight-line depreciation. According to this strategy, an asset's value is reduced by the same amount for each year that it is in use.

<h3>Depreciation formula:</h3>

(Depreciation expense per year = (Cost of the asset - Salvage value) ÷ Useful life.

The given data is -

The cost of asses is given as $64,000.

The salvage value is given as $10,000.

The sole price is $30,000.

Calculation for the depreciation-

Depreciation expense per year = ($64,000 Cost - $10,000 Salvage) ÷ (6               Year life)

Depreciation expense per year = $9,000

Accumulated depreciation on January 1, Year 5 = ($9,000 per year) × (4 years)

Accumulated depreciation on January 1, Year 5 = $36,000.

Book value = $64,000 Cost - $36,000 Accumulated depreciation

                    = $28,000

Gain on sale = $30,000 Sales price - $28,000 Book value

                     = $2,000)

Therefore, the gain on the scale is  $2,000.

To know more about calculation for annual depreciation using the straight-line depreciation method, here

brainly.com/question/27971176

#SPJ4

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Assume Hadley Co has the following purchases of inventory during the first month of operations Number of Units Cost per unit Fir
Ivanshal [37]

Answer:

Ending inventory cost= $948

Explanation:

Giving the following information:

First Purchase=  310 units for  $3 each

Second Purchase= 220 units for $4.9 each

Units sold= 290

First, we need to calculate the weighted average cost:

Weighted average cost= (3 + 4.9)/2= $3.95

Ending inventory (units)= 240 units

Now, ending inventory cost:

Ending inventory cost= 240*3.95= $948

8 0
3 years ago
Selected data from a February payroll register for Coronado Company are presented below. Some amounts are intentionally omitted.
dlinn [17]

Answer:

1. Overtime= $1,000

2. Gross Pay= $10,000

3. State Income Taxes = $400

4. Total Deductions= $2,483

5/ Salaries and wages expenses = $10,000 (Gross Pay)

Explanation:

The question says to find the following:

1. Overtime

2. Total

3. State Income Taxes

4. Total Deductions

5. Salaries and Wages Expense

1. Overtime

Overtime is derived after calculating the total Gross Pay (2nd question)

Total Gross Pay= Regular + Overtime

$10,000= $9,000 + Overtime

Therefore, Overtime = $10,000-$9,000

Overtime= $1,000

2. Total Gross Pay (this should be treated before the 1st which is overtime)

= Gross Pay =

= calculated as FICA tax expense /the percentage of FICA taxes

FICA tax expense = $765

% of FICA taxes = 7.65

Gross Pay= $765 / 7.65% (0.0765)

= $10,000

3. State Income Tax

The state Income Taxes is derived as follows

Gross Pay x the given percentage (4%)

State Income taxes = $10,000 x 0.04

State Income taxes = $400

4. Calculate the total deductions

Total Deductions are the sum of the following

FICA taxes + federal Income taxes + State Income taxes + Union dues

= $765+ $1,128+$400+$190

= $2,483

5. Salaries and Wages Expense

The answer to this is simply the derived total gross pay (regular + overtime) Calculated in step 2

Gross pay= salaries and wages expense= $10,000

4 0
3 years ago
A woman earns 15% more than her husband. Together they make $58,695 per year. What is the husband's annual salary?
yarga [219]

Answer:

$27,300

Explanation:

Let husband's salary be x

Wife's salary is 15% more than husband's salary. This implies that wife's salary is 15% of x plus x.

Wife's salary = 0.15x + x

                     = 1.15x

Sum of their salaries = $58,695

Substituting the values in the equation:

58,695 = 1.15x + x

2.15x = 58,695

x = $27,300

Husband's annual salary is computed as $27,300

3 0
3 years ago
A manager is holding a $1.2 million stock portfolio with a beta of 1.01. She would like to hedge the risk of the portfolio using
garri49 [273]

Answer: $1,212,000 or $1.212 million

Explanation:

To calculate the dollars’ worth of the index the manager should sell in the futures market to minimize the volatility of her position, we can use the following formula,

Dollar worth of index to sell = Value of the Portfolio * Portfolio Beta

Dollar worth of index to sell = 1,200,000 * 1.01

Dollar worth of index to sell = $1,212,000

The manager should sell $1,212,000 worth of the index in the futures market to minimize the volatility of her position.

5 0
3 years ago
A change in depreciation method is accounted for:Select one:a. Retrospectively.b. Prospectively, like changes in accounting esti
arlik [135]

Answer: :a. Retrospectively

Explanation:

A change in depreciation method is a change in accounting policy and as such it would need to be accounted for retrospectively.

This means that it must be accounted for by going back to all periods where the change affects an entry and adjusting that entry for the change so that the accounting can be more accurate.

5 0
3 years ago
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