Answer:
The depreciation expense for the first two years is $72,000.
Explanation:
Under straight-line method, depreciation expense is (Cost - Residual value) / No of years = ($400,000 - $40,000) / 10 years = $36,000 yearly depreciation expense.
Using this method, the depreciation expense for the first two years is $36,000 x 2 years = $72,000. This amount is regarded as the accumulated depreciation at the end of Year 2 while the net book value would be $400,000 - $72,000 = $328,000.
Answer:
B. $300
Explanation:
The interest revenue is computed below:
= Principal × rate of interest × number of months ÷ (total number of months in a year)
= $20,000 × 6% × (3 months ÷ 12 months)
= $300
The 6 months is calculated from October 1 to December 31
Simply we use the simple interest formula by considering the principal amount, rate of interest and time period so that the correct revenue can be computed
Answer:
The amount of interest paid is $ 1,500.
Explanation:
Given that Perry Mazza wants to borrow $ 30,000 from the bank, and the interest rate is 5% and the term is for 5 years, to determine what is the amount of interest paid, the following calculation must be performed:
(30,000 x 5) / 100 = X
150,000 / 100 = X
1,500 = X
Therefore, the amount of interest paid is $ 1,500.
Answer:
assets increase $5,100 and liabilities increase $5,100
Explanation:
Assets are the items that a company owns which can provide future economic benefit.
Liabilities are future sacrifices of economic benefits that an entity is obliged to make to other entities as a result of past transactions or other past events, hence Liabilities are what a person or company owe other parties.
If a company purchases equipment costing $5,100 on credit, the assets of the company will increase by $5100 as a result of acquiring an equipment. Also, the liability will increase by $5100 as a result of debt owed.
