On January 1 . 2013 . Pastel Colors Corporation purchased drilling equipment for $11,500 . The equipment has an estimated useful life of four years and a salvage value of $200 . Assuming that Pastel Colors uses the straight-line method of depreciation, if it trades the equipment for new equipment with a list price of $15,500 on December 31 . 2014, and pays $4,050 in the exchange, assuming the
exchange lacks commercial substance, the new equipment should be recorded at
a. $15,500.
b. $11,450.
c. $9,850.
d. $9,900.
D
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Collini Corporation has two production departments, Machining and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Machining Department's predetermined overhead rate is based on machine-hours and the Customizing Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: MachiningCustomizingMachine-hours 17,000 15,000Direct labor-hours 3,000 6,000Total fixed manufacturing overhead cost$102,000$61,200Variable manufacturing overhead per machine-hour$1.70 Variable manufacturing overhead per direct labor-hour $4.10 During the current month the company started and finished Job T268. The following
data were recorded for this job: Job T268:MachiningCustomizingMachine-hours 80 30Direct labor-hours 30 50Direct materials$720$380Direct labor cost$900$1,500If the company marks up its manufacturing costs by 40% then the selling price for Job T268 would be closest to: A. $7,440.00 B. $6,763.40 C. $4,831.00 D. $1,932.40
Hang 12 manufactures surfboards. During the upcoming quarter, it expects to sell 3,800 surfboards, after which it plans to have 500 surfboards remaining in inventory. If it currently has 200 surfboards on hand, how many surfboards will Hang 12 have to produce for the upcoming quarter?
a. 4,100 b. 3,500 c. 3,800 d. 3,100
Youngstown Company sells merchandise with a one year warranty. Sales consisted of 2,500 units in 2013 and 2,000 units in 2014 . It is estimated that warranty repairs will average $10 per unit sold, and 30% of the repairs will be made in 2013 and 70% in 2014 for the 2013 sales. Similarly, 30% of repairs will be made in 2014 and 70% in 2015 for the 2014 sales. In the 2014 income statement, how much
of the warranty expense shown will be due to 2013 sales? a. $7,500 b. $17,500 c. $25,000 d. $0 e. $12,500
Zach Company owns 40% of the voting stock of Tomas Corporation and uses the equity method in recording this investment. Tomas Corporation reported a $20,000 net loss. Zach Corporation's entry would include a
A) Debit to the investment account for $20,000 B) Debit to the investment account for $8,000 C) Credit to the investment account for $8,000 D) Debit to a loss account for $8,000