Question

A company uses MACRS depreciation.   It has decided to purchase a mainframe computer and would like...

A company uses MACRS depreciation.   It has decided to purchase a mainframe computer and would like to know the depreciation schedule.   You have the following data:

First cost = $550,000.

Salvage Value = $50,000.                             

Property Class =   5-Year.

The book value at the end of year 4 is given by the following.

Group of answer choices

$84,375

$67,342

$25,687

$153,000

$95,040

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Wardell Company purchased a mainframe on January 1, 2016, at a cost of $56,000. The computer...
Wardell Company purchased a mainframe on January 1, 2016, at a cost of $56,000. The computer was depreciated using the straight-line method over an estimated five-year life with an estimated residual value of $11,000. On January 1, 2018, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $2,000. Required: 1. Prepare the year-end journal entry for depreciation in 2018. No depreciation was recorded during the year. 2....
tinney​ & Smyth Inc. is considering the purchase of a new batch​ polymer-bonding machine for producing...
tinney​ & Smyth Inc. is considering the purchase of a new batch​ polymer-bonding machine for producing Crazy​ Rubber, a​ children's toy that is​ soft, pliable but also bouncy. The machine will increase EBITDA by $275,000 per year for the next two years. Assume that operating cash flows occur at the end of each year. The​ machine's purchase price is $305,000 and the salvage value at the end of two years is $67,100.The machine is classified as 3-year property. To run...
Suarez Company uses the straight-line method of depreciation. The company purchased a computer system on January...
Suarez Company uses the straight-line method of depreciation. The company purchased a computer system on January 1, Year 1, for $1,600,000 with an expected life of six years and a salvage value of $130,000. Assuming the computer is sold on July 1, Year 3 for $1,000,000 cash, prepare the journal entries to record depreciation for the first 6 months of Year 3 and the sale of the computer. Can u please put it in a chart so I know how...
MACRS with Trade-In: In May 2011, your company traded in a computer and peripheral equipment, used...
MACRS with Trade-In: In May 2011, your company traded in a computer and peripheral equipment, used in its business, that had a BV at that time of $25,000. A new, faster computer system having a fair market value of $300,000 was acquired. Because the vendor accepted the older computer as a trade-in, a deal was agreed to whereby your company would pay $225,000 cash for the new computer system. a. What is the property class life and recovery year for...
Suarez Company uses the straight-line method of depreciation. The company purchased a computer system on January...
Suarez Company uses the straight-line method of depreciation. The company purchased a computer system on January 1, Year 1, for $1,600,000 with an expected life of six years and a salvage value of $130,000. Assuming the computer is sold on July 1, Year 3 for $1,000,000 cash, prepare the journal entries to record depreciation for the first 6 months of Year 3 and the sale of the computer.
Wardell Company purchased a mainframe on January 1, 2019, at a cost of $58,000. The computer...
Wardell Company purchased a mainframe on January 1, 2019, at a cost of $58,000. The computer was depreciated using the straight-line method over an estimated five-year life with an estimated residual value of $16,000. On January 1, 2021, the estimate of useful life was changed to a total of 10 years, and the estimate of residual value was changed to $2,200. 2. Prepare the year-end journal entry for depreciation in 2021. Assume that the company uses the sum-of-the-years' -digits method...
The Summit Petroleum Corporation will purchase an asset that qualifies for three-year MACRS depreciation. The cost...
The Summit Petroleum Corporation will purchase an asset that qualifies for three-year MACRS depreciation. The cost is $200,000 and the asset will provide the following stream of earnings before depreciation and taxes for the next four years Year 1 - $ 98,000 Year 2 - $119,000 Year 3 - $50,000 Year 4 - $48,000 The firm is in a 36 percent tax bracket and has a cost of capital of 7 percent. a. Calculate the net present value. b. Under...
Highlight Company is considering the purchase of the following computer equipment, which is considered 5-year property...
Highlight Company is considering the purchase of the following computer equipment, which is considered 5-year property for tax purposes: Acquisition cost $420,000 Annual cash flow $140,000 Annual operating costs $ 31,000 Expected salvage value $ 0 Cost of capital 11% Tax rate 35% Highlight Company plans to use Modified accelerated cost recovery system (MACRS) and keep the computer equipment for seven years.What would the MACRS deduction in Year 1 be? (Round your answer to the nearest dollar.)
Foley Word Processing Service uses the straight-line method of depreciation. The company's fiscal year end is...
Foley Word Processing Service uses the straight-line method of depreciation. The company's fiscal year end is December 31. The following transactions and events occurred during the first three years. 2020    July     1     Purchased a computer from the Computer Center for $1,900 cash plus sales tax of $150, and shipping costs of $50.             Nov.    3     Incurred ordinary repairs on computer of $140.             Dec. 31     Recorded 2020 depreciation on the basis of a four-year life and estimated salvage value of...
Sale of an asset Suarez Company uses the straight-line method of depreciation. The company purchased a...
Sale of an asset Suarez Company uses the straight-line method of depreciation. The company purchased a computer system on January 1, Year 1, for $1,600,000 with an expected life of six years and a salvage value of $130,000. Assuming the computer is sold on July 1, Year 3 for $1,000,000 cash, prepare the journal entries to record depreciation for the first 6 months of Year 3 and the sale of the computer.
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT