Capitalize - ANSWER record an expenditure as an asset
Capital expenditures - ANSWER spending to purchase long lived tangible assets
How to compute straight line depreciation (per 1 year) - ANSWER depreciation
expense = (cost - residual value) X 1/useful life
Land is not depreciated
Record year 2 depreciation - ANSWER debit: depreciation expense
Credit: accumulated depreciation
Income statement for assets & depreciation expenses - ANSWER just amortization
expense (add depreciations)
Income statements for assets and their depreciation - ANSWER list assets purchase
cost
Accumulated amortization: added depreciations
Net: purchases costs - amortizations
1
, Find estimated useful life on equipment
Purchase: 16000
Residual: 4000
Accumulated depreciation: 2000 - ANSWER 16000-4000= 12000
12000/2000= 6 years
Record the disposal of computers and their accumulated depreciation to the date of disposal
. - ANSWER debit: accumulated depreciation
Credit: equipment
Record the disposal of computers that had cost $4,800 and their accumulated depreciation
to the date of disposal was $3,600. - ANSWER debit: accumulated depreciation + Loss
on disposal of PPE
Credit: equipment
**loss on disposal when different sums
Fixed asset turnover ratio formula - ANSWER Net Sales / Average Net Fixed Assets
Units of production depreciation - ANSWER (cost-residual value) * actual total
production/estimated production
Double-decling balance depreciation - ANSWER (cost-residual) * 2/useful life
2
Capital expenditures - ANSWER spending to purchase long lived tangible assets
How to compute straight line depreciation (per 1 year) - ANSWER depreciation
expense = (cost - residual value) X 1/useful life
Land is not depreciated
Record year 2 depreciation - ANSWER debit: depreciation expense
Credit: accumulated depreciation
Income statement for assets & depreciation expenses - ANSWER just amortization
expense (add depreciations)
Income statements for assets and their depreciation - ANSWER list assets purchase
cost
Accumulated amortization: added depreciations
Net: purchases costs - amortizations
1
, Find estimated useful life on equipment
Purchase: 16000
Residual: 4000
Accumulated depreciation: 2000 - ANSWER 16000-4000= 12000
12000/2000= 6 years
Record the disposal of computers and their accumulated depreciation to the date of disposal
. - ANSWER debit: accumulated depreciation
Credit: equipment
Record the disposal of computers that had cost $4,800 and their accumulated depreciation
to the date of disposal was $3,600. - ANSWER debit: accumulated depreciation + Loss
on disposal of PPE
Credit: equipment
**loss on disposal when different sums
Fixed asset turnover ratio formula - ANSWER Net Sales / Average Net Fixed Assets
Units of production depreciation - ANSWER (cost-residual value) * actual total
production/estimated production
Double-decling balance depreciation - ANSWER (cost-residual) * 2/useful life
2
