Accounting

ACT 500 Final Exam Review 1. P85. Req. 1 ?a. Straight-line: year| computer science| dispraise depreciate| hive away Depreciation| NetBook order| At scholarship| | | | $106,000| 1| ($106,000 - $2,000) x 1/13| $8,000| $ 8,000| 98,000| 2| ($106,000 - $2,000) x 1/13| $8,000| 16,000| 90,000| ?b. Units-of-production: ($106,000 $2,000) 200,000 = $0.52 per unit of output Year| numeration| Depreciation Expense| Accumulated Depreciation| NetBook Value| At acquisition| | | | $106,000| 1| $0.52 x 20,000 units| $10,400| $10,400| 95,600| 2| $0.52 x 16,000 units| 8,320| 18,720| 87,280| c. Double-declining-balance: Year| Computation| Depreciation Expense*| Accumulated Depreciation| NetBook Value| At acquisition| | | | $106,000| 1| ($106,000 - $0) x 2/13| $16,308| $16,308| 89,692| 2| ($106,000 - $16,308) x 2/13| 13,799| 30,107| 75,893| *Rounded to the warm dollar. Req.

2 currency flowFor tax purposes, the declining-balance (DB) method usually is viewed as favored because an early tax deduction is preferable to a covert tax deduction. DB depreciation expense is highest; therefore, it yields pull raft taxable income and therefore depress income tax payable (and rase cash outflow) in the early years. In posterior years, this karyon would reverse. Other than cash outflows for taxes, cash flows are unaffected by the method chosen by management for financial reporting purposes. Companies may select different methods for tax and financial reporting. persistent ass! et turnoverThe DB method would be active favorable for fixed asset turnover. Because this depreciation method yields the highest shopping centre of depreciation expense, it yields the lowest level of net fixed assets and then the highest fixed asset turnover during the early years. In later years, this effect...If you want to get a full essay, order it on our website: OrderEssay.net

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