Financial Accounting
Learning Task Number Four
The Henry Furniture Co. is a new company and has numerous fixed assets that need to be depreciated. You can help Henry by determining the depreciation rates for the assets and the amount of depreciation for year one. The assets were purchased at various times during the year (hint: watch out for the dates). The following assets will be held by the company for at least the next two years (In other words, year two will be a full year for all of the assets). Please fill in the blanks below.
Asset #1—Building: Henry purchased the building on January 2, 2011 for $800,000. The building is to be depreciated using the straight-line method over a period of 40 years with no salvage value. Depreciation for year 1 $ 20,000 Depreciation for year 2 $40,000
Asset #2—Garage: Henry purchased the garage on March 1, 2011 as a place to work on the vehicles and equipment. The garage cost $300,000 and will be depreciated using the straight-line method over a period of 40 years with a salvage value of $20,000. Depreciation for year 1 $7,000 Depreciation for year 2 $14,000
Asset #3—Delivery Vehicle—Henry purchased a new delivery vehicle on April 1, 2011 for $80,000. The vehicle is to be depreciated over 7 years using double-declining-balance with a salvage value of $10,000. Depreciation for year 1 $57,144 Depreciation for year 2 $40,818
Asset #4—Furniture manufacturing equipment—Henry purchased furniture making equipment on February 1, 2011 for $500,000. The equipment is expected to last ten years, have a salvage value of $30,000 and be depreciated using the double-declining-balance method. Depreciation for year 1 $9,400 Depreciation for year 2 $752
Asset #5—Assembly Line—Henry purchased an assembly line on January 15, 2011 for $400,000. The line will be depreciated using the units of activity method of depreciation. The line has no salvage value and will be depreciated over twenty years or
The Henry Furniture Co. is a new company and has numerous fixed assets that need to be depreciated. You can help Henry by determining the depreciation rates for the assets and the amount of depreciation for year one. The assets were purchased at various times during the year (hint: watch out for the dates). The following assets will be held by the company for at least the next two years (In other words, year two will be a full year for all of the assets). Please fill in the blanks below.
Asset #1—Building: Henry purchased the building on January 2, 2011 for $800,000. The building is to be depreciated using the straight-line method over a period of 40 years with no salvage value. Depreciation for year 1 $ 20,000 Depreciation for year 2 $40,000
Asset #2—Garage: Henry purchased the garage on March 1, 2011 as a place to work on the vehicles and equipment. The garage cost $300,000 and will be depreciated using the straight-line method over a period of 40 years with a salvage value of $20,000. Depreciation for year 1 $7,000 Depreciation for year 2 $14,000
Asset #3—Delivery Vehicle—Henry purchased a new delivery vehicle on April 1, 2011 for $80,000. The vehicle is to be depreciated over 7 years using double-declining-balance with a salvage value of $10,000. Depreciation for year 1 $57,144 Depreciation for year 2 $40,818
Asset #4—Furniture manufacturing equipment—Henry purchased furniture making equipment on February 1, 2011 for $500,000. The equipment is expected to last ten years, have a salvage value of $30,000 and be depreciated using the double-declining-balance method. Depreciation for year 1 $9,400 Depreciation for year 2 $752
Asset #5—Assembly Line—Henry purchased an assembly line on January 15, 2011 for $400,000. The line will be depreciated using the units of activity method of depreciation. The line has no salvage value and will be depreciated over twenty years or