Question : 91. Equipment with a cost of $160,000 has an estimated residual : 1234165

91. Equipment with a cost of $160,000 has an estimated residual value of $10,000 and an estimated life of 5 years or 12,000 hours. It is to be depreciated by the straight-line method. What is the amount of depreciation for the first full year, during which the equipment was used 3,300 hours? 
A. $30,000
B. $32,500
C. $34,000
D. $40,000

92. A machine with a cost of $65,000 has an estimated residual value of $5,000 and an estimated life of 4 years or 18,000 hours. What is the amount of depreciation for the second full year, using the double declining-balance method? 
A. $15,000
B. $30,000
C. $16,250
D. $32,500

93. The most widely used depreciation method is 
A. straight-line
B. sum-of-the-years-digits
C. declining-balance
D. units-of-production

94. Equipment with a cost of $80,000, an estimated residual value of $5,000, and an estimated life of 15 years was depreciated by the straight-line method for 5 years. Due to obsolescence, it was determined that the useful life should be shortened by 5 years and the residual value changed to zero. The depreciation expense for the current and future years is 
A. $5,500
B. $11,000
C. $10,000
D. $5,000

95. The depreciation method that does not use residual value in calculating the first year’s depreciation expense is 
A. straight-line
B. units-of-production
C. double-declining-balance
D. none of the above

96. If a fixed asset, such as a computer, were purchased on January 1st for $1,950 with an estimated life of 3 years and a salvage or residual value of $150, the journal entry for monthly expense under straight-line depreciation is:
(Note: EOM indicates the last day of each month.) 
A. EOM Depreciation Expense                               50.00
                 Accumulated Depreciation                             50.00
B. EOM Depreciation Expense                             600.00
                 Accumulated Depreciation                            600.00
C. EOM Accumulated Depreciation                      600.00
                 Depreciation Expense                                   600.00
D. EOM Accumulated Depreciation                       50.00
                 Depreciation Expense                                     50.00

97. The proper journal entry to purchase a computer on account to be utilized within the business would be: 
A. Jan 2   Office Supplies                                1,250.00
                  Accounts Payable                                      1,250.00
B. Jan 2   Office Equipment                             1,250.00
                  Accounts Payable                                      1,250.00
C. Jan 2   Office Supplies                                1,250.00
                  Accounts Receivable                                  1,250.00
D. Jan 2   Office Equipment                             1,250.00
                  Accounts Receivable                                  1,250.00

98. Residual value is also known as all of the following except 
A. scrap value
B. trade in value
C. salvage value
D. net book value

99. The formula for depreciable cost is 
A. initial cost + residual value
B. initial cost – residual value
C. initial cost – accumulated depreciation
D. depreciable cost = initial cost

100. Expected useful life is 
A. calculated when the asset is sold.
B. estimated at the time that the asset is placed in service.
C. determined each year that the depreciation calculation is made.
D. none of the answers are correct.