ACC 304 All Assignments ACC 304 All Assignments | Page 192

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midterm-part-2
1) 1) A machine which cost $300,000 is acquired on October1, 2014.
Its estimated salvage value is $30,000 and its expected life is eight
years.
a)
Calculate depreciation expense for 2014 and 2015 by double-
declining balance
b) Calculate depreciation expense for 2014 and 2015 by sum-of-the-
years-digits
c)
At the end of 2015, which method results in the larger
accumulated depreciation amount?
2) Assume in each case that the selling expenses are $8 per unit and
that the normal profit is $5 per unit. Calculate the limits for each case.
Then enter the amount that should be used for lower of cost or market
3) Purchased merchandise costing $2,500 with terms 2/10, n/30.
a) Inventory = ???
b) Payment was made thirty days after the purchase