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ACCT1101 Lecture Notes - Lecture 28: Smap Discography, Historical Cost, Accounts Payable

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UQ
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Accounting
Course
ACCT1101
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All

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Document Summary

If the asset is held for part of the year then the annual depreciation is adjusted to reflect this: the accumulated depreciation is reported on the balance sheet under the asset group to which it relates. Look at the shopfitti(cid:374)gs & e(cid:395)uip(cid:373)e(cid:374)t fo(cid:396) pa(cid:373)(cid:859)s pa(cid:396)t(cid:455) shop pt(cid:455) ltd: at 30 june 2012, the shopfittings & equipment had a net book value as follows: Net book value ,600: at 30 june 2013, the shopfittings & equipment had a net book value as follows: Liabilities are the economic obligations (debts) of a business. Statement of changes in owner"s equity: the state(cid:373)e(cid:374)t of cha(cid:374)ges i(cid:374) o(cid:449)(cid:374)e(cid:396)(cid:859)s e(cid:395)uit(cid:455) su(cid:373)(cid:373)a(cid:396)ises the t(cid:396)a(cid:374)sa(cid:272)tio(cid:374)s affe(cid:272)ti(cid:374)g o(cid:449)(cid:374)e(cid:396)(cid:859)s e(cid:395)uit(cid:455) fo(cid:396) the a(cid:272)(cid:272)ou(cid:374)ti(cid:374)g pe(cid:396)iod, o(cid:374) the (cid:374)e(cid:454)t slide is the state(cid:373)e(cid:374)t of cha(cid:374)ges i(cid:374) o(cid:449)(cid:374)e(cid:396)(cid:859)s e(cid:395)uit(cid:455) fo(cid:396) s(cid:449)eet. I(cid:374) a sole p(cid:396)op(cid:396)ieto(cid:396)ship, the(cid:396)e is o(cid:374)l(cid:455) o(cid:374)e o(cid:449)(cid:374)e(cid:396)(cid:859)s e(cid:395)uit(cid:455) a(cid:272)(cid:272)ou(cid:374)t (cid:894)o(cid:449)(cid:374)e(cid:396)(cid:859)s.

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Related Questions

25.Which of the following items does not affect the calculation of depreciation expense?

A.Economic benefits generated by the asset

B.Useful life of the asset

C.Residual value of the asset

D.Capitalized cost of the asset

26.Which of the following statements is correct when the straight-line method is used to compute depreciation?

A.The carrying value of an asset is a constant amount during the asset's useful life

B.Accumulated depreciation is a constant amount during the asset's estimated useful life

C.Depreciation Expense is a constant amount each year

D.The book value of an asset is an increasing amount during the asset's useful life

27.One difference between the double-declining-balance method and the straight-line method is that the double-declining-balance method:

A.reduces book value below residual value.

B.does not consider the useful life of the asset in the calculation of depreciation.

C.cannot be used for tax purposes.

D.uses book value instead of depreciable cost in the calculation of depreciation.

28.Why don't all companies use the same depreciation method?

A.US income tax regulations require that a company use the same depreciation method for both financial reporting and income taxes.

B.Different depreciation methods might better reflect the pattern in which assets' economic benefits are used.

C.All companies do use the same depreciation method.

D.Only large companies are allowed to use some of the more complicated depreciation methods.

Exercise: 2 A plant assets required at a total cost of $37,500has an estimated scrap value of $2,500 and an anticipated usefullife of 7 years. Determine: 1. The annual rate (expressed as apercentage or fraction) of depreciation using thestraight-line-method. 2. The annual depreciation using the straightline method. 3. The first year's straight-line depreciation,assuming that the asset was acquired 3 months into the currentaccounting period. 4. Continuing with assumption (3), the value ofthe accumulated depreciation account after the second year'sdepreciation is recognized. 5. The residual value for the plantassets after the asset has been depreciated for 7 years. 6. Usingthe information presented at the beginning of the exercise 2,determine the five items assuming asset depreciation and using thedouble-declining method of recognizing depreciation. 7. Using theinformation presented at the beginning of the exercise 2, determinethe five items assuming asset depreciation and using the sum of theyears' digits method.

A plant assets required at a total cost of $37,500 has anestimated scrap value of %2,500 and an anticipated useful life of 7years. Determine: 1. The annual rate (expressed as a percentage orfraction) of depreciation using the straight-line-method. 2. Theannual depreciation using the straight line method. 3. The firstyear's straight-line depreciation, assuming that the asset wasacquired 3 months into the current accounting period. 4. Continuingwith assumption (3), the value of the accumulated depreciationaccount after the second year's depreciation is recognized. 5. Theresidual value for the plant assets after the asset has beendepreciated for 7 years. 6. Using the information presented at thebeginning of the exercise 2, determine the five items assumingasset depreciation and using the double-declining method ofrecognizing depreciation. 7. Using the information presented at thebeginning of the exercise 2, determine the five items assumingasset depreciation and using the sum of the years' digitsmethod.