1. A plant asset purchased for $400,000 has an estimated life of 10 years and a residual value of $20,000. Depreciation for the second year of use, determined by the declining-balance method at twice the straight-line rate is:
2. A plant asset purchased for $330,000 at the beginning of the year has an estimated life of 5 years and a residual value of $30,000. Depreciation for the third year, determined by the sum-of-the-years'-digits method is:
3. A plant asset with a cost of $320,000 and accumulated depreciation of $90,000, is given together with cash of $120,000 in exchange for a similar asset worth $330,000. The disposal results in a gain or loss (select one) of:
4. A plant asset with a cost of $270,000, estimated life of 5 years, and residual value of $45,000, is depreciated by the straight-line method. This asset is sold for $190,000 at the end of the second year of use. The disposal results in a gain or loss (select one) of:
5. Barkley Corp. obtained a trade name in January 2013, incurring legal costs of $36,000. The company amortizes the trade name over 8 years. Barkley successfully defended its trade name in January 2014, incurring $9,800 in legal fees. At the beginning of 2015, based on new marketing research, Barkley determines that the fair value of the trade name is $30,000. Estimated total future cash flows from the trade name are $32,000 on January 4, 2015.© BrainMass Inc. brainmass.com October 25, 2018, 9:22 am ad1c9bdddf
The problem set deals with the amortization of an intangible asset, straight-line depreciation, double-declining, etc.
Financial Accounting Problems on Recording Intangible Assets
Posting and journalizing transactions. See attached file for full problem descriptions.View Full Posting Details