Dover has an accounting period ending December 31. Dover Co. holds Gold inc, $1,

Question

Dover has an accounting period ending December 31. Dover Co. holds Gold inc, $1,000 60-day, 12% note july L when Dover Co. receives the check form the Gold for the full amount of the due, Dover will a. Debit Cash for $ 1,020. b. Credit interest Revenue for $120 c. Credit notes Receivable for $ 1,020. d. Debit to Notes Receivable of $,,000. 26. The reason we record depreciation of assets it a. Allocate the cost of assets to expense in periods that benefit form use of the b. Record the turn market value of the value. c. revalue assets that have declined in value d. Provide a fund to replace the depreciable . 27. On july 1.2014 Dody Co. Bough equipment for $ 540,000. The equipment had a 5- year useful life and $ 40,000 salvage value. Dody Co. uses the straight-ling depreciations method. How much depreciation expense is reported on the 12/31/2014 income statement? a. $50,000 b. $ 54,000 c. $100,000 d. $ 108,000 28. Equipment with a cost of $60,000 and accumulated depreciation of $ 55,000 is sold for $ 6,000 cash. The journal entry to record the asset disposal is;

Explanation / Answer

25 The journal entry would be Cash Dr 1020 Note Receivable 1000 Interest Income 20 The correct option is a. Debit Cash for $1,020 26 The correct option is A. Allowance the cost of assets to expense in periods that benefits from the use of asset. 27 Depreciation Cost- Salvage/ Life 540000-40000/5 $100,000 For 2014 100000/2 = $ 50000 The depreciation will be $ 50000 The correct option is a. $ 50000 28 The journal entry would be Cash 6000 Accumulated dep 55000 Equipment 60000 Gain on sales 1000

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