Question : 49.At the end of the current accounting period, Rodgers Co. : 1254520

49.At the end of the current accounting period, Rodgers Co. recorded depreciation of $25,000 on its equipment. The effect of this entry on the company’s balance sheet is to:   

A. decrease assets and increase liabilities.

B. decrease owners’ equity and increase liabilities.

C. decrease assets and increase owners’ equity.

D. decrease owners’ equity and decrease assets.

50.On January 1, 2013, Fritz Company purchased a truck that cost $38,000. The truck had an expected useful life of 8 years and an $8,000 salvage value. The book value of the truck at the end of 2013, assuming that Fritz uses the double declining balance method, is:   

A. $20,500.

B. $28,500.

C. $30,500.

D. $22,500.

51.On January 1, 2013, Fritz Company purchased a truck that cost $38,000. The truck had an expected useful life of 100,000 miles over 8 years and an $8,000 salvage value. During 2014, Fritz drove the truck 18,500 miles. The amount of depreciation expense recognized in 2014 assuming that Fritz uses the units of production method is:   

A. $5,550.

B. $7,030.

C. $3,750.

D. $4,750.

52.Easton Company purchased equipment that cost $55,000 cash on January 1, 2012. The equipment had an expected useful life of six years and an estimated salvage value of $4,000. Assuming that Easton depreciates its assets under the straight-line method, the amount of depreciation expense appearing on the 2015 income statement and the amount of accumulated depreciation appearing on the December 31, 2015 balance sheet would be:     

A. Option A

B. Option B

C. Option C

D. Option D

53.Clarkson Company paid cash to purchase equipment on January 1, 2013. Select the answer that shows how the recognition of depreciation expense in 2014 would affect assets, liabilities, equity, net income, and cash flow (+ means increase, – decrease, and NA not affected).     

A. Option A

B. Option B

C. Option C

D. Option D

54.On January 1, 2013 Dungan Company purchased a car that cost $35,000. The car had an expected useful life of 6 years and a $10,000 salvage value. Based on this information alone:   

A. The amount of depreciation expense recognized in 2016 would be greater if Dungan depreciates the car under the straight-line method than if the double declining balance method is used.

B. The total amount of depreciation expense recognized over the six year useful life will be greater under the double declining balance method than the straight-line method.

C. At the end of 2015, the amount in accumulated depreciation account will be less if the double declining balance method is used than it would be if the straight-line method is used.

D. None of these statements is true.

55.Using double-declining balance depreciation, determine the amount of depreciation expense and the amount of accumulated depreciation that would appear on the December 31, 2015 financial statements.   

A. $0/$12,000.

B. $4,320/$11,520.

C. $480/$12,000.

D. $2,592/$14,112.

56.Assume that Wu Company earned $15,000 cash revenue and incurred $9,500 in cash expenses in 2015. Using straight-line depreciation and assuming that the office equipment was sold on 12/31/15 for $8,000, the amount of net income or (loss) appearing on the December 31, 2015 income statement would be:   

A. ($3,300).

B. $300.

C. $2,700.

D. $3,100.

57.At the end of 2018, the book value of the office equipment using straight-line depreciation and double-declining balance depreciation, respectively, would be:   

A. $6,000/$840.

B. $6,000/$6,000.

C. $0/$0.

D. None of these answers is correct.

58.Diaz Company purchased a truck that cost $36,000. The company expected to drive the truck 100,000 miles over its 5-year useful life, and the truck had an estimated salvage value of $5,000. If the truck is driven 26,000 miles in the current accounting period, what would be the amount of depreciation expense for the year?   

A. $8,060.

B. $9,360.

C. $6,200.

D. $14,400.