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Aleksandr [31]
3 years ago
7

Schager Company purchased a computer system at a cost of $40,000. The estimated useful life is 10 years, and the estimated resid

ual value is $5,000. Assuming the company will use the double-declining-balance method, what is the depreciation expense for the second year?
(A) $6,400.
(B) $5,600.
(C) $8,000.
(D) $7,000.
Business
1 answer:
Elodia [21]3 years ago
7 0

Answer:

The correct answer is B: $5,600

Explanation:

Giving the following information:

Schager Company purchased a computer system for $40,000. The estimated useful life is 10 years, and the estimated residual value is $5,000.

Double-declining balance method= Netbook value* (2/useful life in years)

Year 1:

Double-declining balance method= (40000-5000)*(2/10)= $7000

Year 2:

Double-declining balance method= (35000-7000)*0.20= $5,600

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B is the correct answer.
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Ellen loans Nicole $45,000 to start a hair salon. Unfortunately, the business fails in 2019 and she is unable to pay back Ellen.
Dahasolnce [82]

Answer:

c. $18,000, with $27,000 carried forward to 2020.

Explanation:

Non-business bad debts are accounted as short-term capital losses. Short-term and long-term capital gains may be offset by short-term capital losses. Ellen may offset $15,000 of her $45,000 bad debt from Nicole against the $15,000 capital gain from the sale of stock.

In addition, Ellen may claim up to the annual limitation amount of $3,000 in short-term capital losses. In total, $18,000 of the bad debt can be claimed as a capital loss in the current year with $27,000 in unused short-term capital losses carried forward.

5 0
3 years ago
Determine which of the following statements is correct regarding the relationship of ending inventory and beginning inventory.
antiseptic1488 [7]

The ending inventory of the previous period is the beginning inventory of the current period.

Beginning inventory is the amount of a product. A commercial enterprise has in stock at the start of an accounting length which includes a month or 12 months. due to the fact each accounting length connects to the subsequent, the beginning inventory of one length will be similar to the ending inventory of the previous.

Beginning inventory, or opening inventory, is your inventory cost at the beginning of an accounting duration. For that reason, finishing inventory, or last inventory is the cost of the stock at the top of an accounting duration.

Ending inventory is the value of goods nevertheless available for sale and held via a business enterprise at the end of an accounting length. The dollar amount of ending stock may be calculated by the usage of multiple valuation techniques.

Learn more about Beginning inventory here: brainly.com/question/24868116

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6 0
2 years ago
Darcy Roofing is faced with a decision. The company relies very heavily on the use of its 60-foot extension lift for work on lar
meriva

Answer:

$ 102,100

Explanation:

Based on the scenario been described in the question the incremental Analysis for replacement of old equipment:

Cost of New used lift

$ 190,500

Saving in Incremental Cost of Repair of old lift

$ (45,000)

Reduction in Annual operating expenses = $25,600 * 6 years

$ (153,600)

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$ (28,000)

Saving in Incremental Costs

$ (102,100)

Net income increase

$ 102,100

Hence, the net income shall increase by $102,100 if the old liftis replaced.

3 0
3 years ago
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