Question

Roberto, Inc. purchased a truck on January 1, 2016, for $96,000. At that time, the truck's useful life was an estimated s with no salvage value. Before the entry to record 2019 depreciation was made, the truck's estimated useful life was changed to six years with a $1,800 salvage value. Using straight-line deprecation, what is the 2019 depreciation expense? O A $12,000 B.$ 2,700 OC. $ 6,000 OD. $ 7,400 QUESTION 34 2 po At what amount will accounts receivable for Progress Company be reported on the balance sheet if the grass receivable balance is 552,000 and the allowance for doubtful accounts is estimated at 4% of gross receivables? O A $49,920 B. 547,000 C. $28,200 D. 552.960

Answer 1

Depreciation per year on the basis of straight line depreciation = (Cost - Salvage value) / Life

= ($96,000 - $0) / 4

= $24,000 per year.

Year 2016 = $24,000

Year 2017= $24,000

Year 2018 = $24,000

Book value after 2018 = Cost - Accumulated depreciation

= $96,000 - ($24,000 + $24,000 + $24,000)

= $24,000

Now, useful life changed to 6 years, remaining years are 3 years and salvage value is $1,800.

Depreciation in year 2019 = (Book value - Salvage value) / Years

= ($24,000 - $1,800) / 3 years

= $7,400

$7,400 is the correct answer.

34.

Account receivable be reported on the balance sheet = $52,000 - ($52,000 * 4%)

= $52,000 - $2,080

= $49,920

$49,920 is the correct answer.