EXAM #4: (Ch 10, 11) Review (In-class) Flashcards
A building with a life of 10 years was purchased for $100,000. It is estimated that the company will be able to sell it for 10% of its original cost after 10 years. What is the book value at the end of the 2nd year using the double declining balance?
How do you find Straight-line rate?
Straight-line rate = 1/life
How do you find Book Value?
Cost - Accumulated Depreciation
A building with a life of 10 years was purchased for $100,000. It is estimated that the company will be able to sell it for 10% of its original cost after 10 years.
If the building is sold at the end of the 2nd year for $60,000 cash, whati s the gain or loss?
A building with a life of 10 years was purchased for $100,000. It is estimated that the company will be able to sell it for 10% of its original cost after 10 years.
What if the building had been sold for $20,000 cash and a note of $50,000?
