Answer:
$16,500
Explanation:
Straight line method of depreciation charges the same amount of depreciation on the asset over its useful life.
Depreciation Charge = Cost - Salvage Value / Number of Useful Life
<u>Component Approach</u>
Considers the depreciation charges separately of different components that make up total asset due to difference in number of useful life.
Warehouse :
Depreciation Charge = ($280,000 - $50,000) / 20 years
= $11,500
(HVAC) system :
Depreciation Charge = $50,000 / 10 years
= $5,000
Depreciation : First Year = Depreciation charge for Warehouse + Depreciation charge for (HVAC) system
=$11,500 + $5,000
=$16,500
Answer:
b. 50,000
Explanation:
According to the given situation, the computation of impairment loss is shown below:-
The Amount of impairment loss to be recognized at December 31, 20X8 is
= Net assets - Fair value of reporting unit
= $310,000 - $260,000
= $50,000
Therefore we applied the above formula to determine the amount of impairment loss to be recognized at December 31, 20X8.
Answer:
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