Exercise 11-2 Sunland Company acquired a plant asset at the beginning of Year 1.

Question

Exercise 11-2 Sunland Company acquired a plant asset at the beginning of Year 1. The asset has an estimated service life of 5 years. An employee has prepared depreciation schedules for this asset using three different methods to compare the results of using one method with the results of using other methods. You are to assume that the following schedules have been correctly prepared for this asset using (1) the straight-line method, (2) the sum-of-the-years'-digits method, and (3) the double-declining-balance method Sum-of-the- Year Straight-Line Years'-Digits Double- Declining- Balance $10,800 10,800 10,800 10,800 10,800 $54,000 $18,000 14,400 10,800 7,200 3,600 $54,000 $24,000 14,400 8,640 5,184 1,776 $54,000 2 3 4 Total Answer the following questions What is the cost of the asset being depreciated? Cost of asset

Explanation / Answer

1) The cost of the asset is same as total depreciation using any of the method and it is 54000
2)The salvage value used here is 0 we can find it
Using straight line
Depreciation=(cost-salvage)/years
10800=(54000-x)/5
X=0

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.