Compute depreciation expense under each of the following methods. Bogues is on a calendar-year basis ending December 31.

Brief Exercise 11-2

Lockard Company purchased machinery on January 1, 2014, for $149,520. The machinery is estimated to have a salvage value of $14,952 after a useful life of 8 years.

 

 

Compute 2014 depreciation expense using the straight-line method.

Depreciation expense $

 

 

Compute 2014 depreciation expense using the straight-line method assuming the machinery was purchased on September 1, 2014.

Depreciation expense $

 

Brief Exercise 11-4

Lockard Company purchased machinery on January 1, 2014, for $127,920. The machinery is estimated to have a salvage value of $12,792 after a useful life of 8 years.

 

 

Compute 2014 depreciation expense using the double-declining-balance method.

Depreciation expense $

 

 

Compute 2014 depreciation expense using the double-declining-balance method, assuming the machinery was purchased on October 1, 2014.

Depreciation expense $

 

 

 

 

Brief Exercise 11-9

Everly Corporation acquires a coal mine at a cost of $654,800. Intangible development costs total $163,700. After extraction has occurred, Everly must restore the property (estimated fair value of the obligation is $130,960), after which it can be sold for $261,920. Everly estimates that 6,548 tons of coal can be extracted.

If 1,146 tons are extracted the first year, prepare the journal entry to record depletion. (If no entry is required, select “No entry” for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation Debit Credit

 

Exercise 11-6

Muggsy Bogues Company purchased equipment for $320,275 on October 1, 2014. It is estimated that the equipment will have a useful life of 8 years and a salvage value of $20,040. Estimated production is 40,300 units and estimated working hours are 19,300. During 2014, Bogues uses the equipment for 560 hours and the equipment produces 1,100 units.

Compute depreciation expense under each of the following methods. Bogues is on a calendar-year basis ending December 31.

(a) Straight-line method for 2014 (Round answer to 0 decimal places, e.g. 45,892.) $
(b) Activity method (units of output) for 2014 (Round rate per unit to 2 decimal places, e.g. 5.35 and final answer to 0 decimal places, e.g. 45,892.) $
(c) Activity method (working hours) for 2014 (Round rate per hour to 2 decimal places, e.g. 5.35 and final answer to 0 decimal places, e.g. 45,892.) $
(d) Sum-of-the-years’-digits method for 2016 (Round answer to 0 decimal places, e.g. 45,892.) $
(e) Double-declining-balance method for 2015 (Round answer to 0 decimal places, e.g. 45,892.) $

 

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