Question

Coutinho Company depreciates an asset with an original cost of $60,000 using the activity-based method of...

Coutinho Company depreciates an asset with an original cost of $60,000 using the activity-based method of depreciation. The asset was purchased in 2020 and used for 350 hours in the year. The useful life of the asset is estimated to be 5,000 hours and the depreciation expense for 2020 is $3,920. What is the estimated salvage value of the asset?

Multiple Choice

  • $4,600

  • $6,000

  • $5,500

  • $5,000

  • $4,000

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Correct answer------------$4000

Working

Depreciation of 2020 $       3,920.00
Hours used in 2020 350
Depreciation per hour $             11.20

.

Depreciation of 2020 $       3,920.00
Hours used in 2020 350
Depreciation per hour $             11.20
Multiplied by: Life of asset (in hours) $       5,000.00
Depreciable base of asset $    56,000.00
Salvage value (60000-56000) $       4,000.00

.

A Cost $ 60,000
B Residual Value (Balancing figure) $ 4,000
C=A - B Depreciable base $ 56,000
D Usage in units(in Hours) 5,000
E Depreciation per hour $ 11.20
0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Haaland Company depreciates an asset with an original cost of $8,000 over 5 years using the...
Haaland Company depreciates an asset with an original cost of $8,000 over 5 years using the sum-of-the-years digits’ method of depreciation. The asset was purchased on July 1, 2020 and the depreciation expense for 2020 is $1,250. What is the estimated salvage value of the asset? Multiple Choice $1,000 $500 $1,250 $750 $250
Vaughn Manufacturing purchased a depreciable asset for $572000. The estimated salvage value is $27000, and the...
Vaughn Manufacturing purchased a depreciable asset for $572000. The estimated salvage value is $27000, and the estimated useful life is 10000 hours. Carson used the asset for 1300 hours in the current year. The activity method will be used for depreciation. What is the depreciation expense on this asset in the current year? $545000 $54500 $70850 $77870
Saul Company purchased a tractor at a cost of $180,000. The tractor has an estimated salvage...
Saul Company purchased a tractor at a cost of $180,000. The tractor has an estimated salvage value of $20,000 and an estimated life of 8 years, or 12,000 hours of operation. The tractor was purchased on January 1, 2019 and was used 2,400 hours in 2019 and 2,200 hours in 2020. What method of depreciation will produce the maximum depreciation expense in 2019? Select one: A. Units-of-production B. Double-declining-balance C. Straight-line D. All methods produce the same expense in 2019...
Annual depreciation expense on equipment purchased a few years ago (using the straight-line method) is $5,000....
Annual depreciation expense on equipment purchased a few years ago (using the straight-line method) is $5,000. The cost of the equipment was $100,000. The current book value of the equipment (January 1, 2021) is $85,000. At the time of purchase, the asset was estimated to have a zero salvage value. On January 1, 2021, the company decided to reduce the original useful life by 25% and to establish a salvage value of $5,000. The firm also decided double-declining-balance depreciation was...
On October 1, 2021, Holt Company places a new asset into service. The cost of the...
On October 1, 2021, Holt Company places a new asset into service. The cost of the asset is $120,000 with an estimated 5-year life and $30,000 salvage value at the end of its useful life. What is the depreciation expense for 2021 if Holt Company uses the straight-line method of depreciation?
On October 1, 2021, Sunland Company places a new asset into service. The cost of the...
On October 1, 2021, Sunland Company places a new asset into service. The cost of the asset is $130000 with an estimated 5-year life and $29000 salvage value at the end of its useful life. What is the depreciation expense for 2021 if Sunland Company uses the straight-line method of depreciation?
1.Trouble Company purchased equipment on January 1, 2016, for $60,000. It is estimated that the equipment...
1.Trouble Company purchased equipment on January 1, 2016, for $60,000. It is estimated that the equipment will have a $5,000 salvage value at the end of its 5-year useful life. It is also estimated that the equipment will produce 100,000 units over its 5-year life. Compute depreciation expense for 2016 using the straight-line method of depreciation. 2. Adriane’s Grocery Store had a beginning inventory of $14,000 and an ending inventory of $19,000. Net sales during the year amounted to $78,000...
Tucker Ltd purchases an equipment for $300,000 on 1 July 2015 and depreciates the asset over...
Tucker Ltd purchases an equipment for $300,000 on 1 July 2015 and depreciates the asset over 15 years. The estimated residual value is $30,000. On 30 June 2018, the management of Tucker Ltd assesses the equipment as having a recoverable amount of $200,000. What should be the depreciation expense recorded by Tucker Ltd on 30 June 2019 assuming the original estimated useful life and residual value remain the same?         a) $14,167         b) $16,667         c)...
A company called Addison Company bought a vehicle on January 1, 2002 that had an original...
A company called Addison Company bought a vehicle on January 1, 2002 that had an original costs of 60,000, with an estimated salvage value of 5,000 and an estimated useful life of 5 years. What is the book value as of 12-31-05 using the double-declining balance method?
Only " Using Straight line method of depreciation " Each sale entry is a four line...
Only " Using Straight line method of depreciation " Each sale entry is a four line entry. E10.10 (LO 3) Pryce Company owns equipment that cost $65,000 when purchased on January 1, 2017. It has been depreciated using the straight-line method based on estimated salvage value of $5,000 and an estimated useful life of 5 years. a. Sold for $31,000 on January 1, 2020. b. Sold for $31,000 on May 1, 2020. c. Sold for $11,000 on January 1, 2020....
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT