Exercise: 2 A plant assets required at a total cost of $37,500has an estimated scrap value of $2,500 and an anticipated usefullife of 7 years. Determine: 1. The annual rate (expressed as apercentage or fraction) of depreciation using thestraight-line-method. 2. The annual depreciation using the straightline method. 3. The first year's straight-line depreciation,assuming that the asset was acquired 3 months into the currentaccounting period. 4. Continuing with assumption (3), the value ofthe accumulated depreciation account after the second year'sdepreciation is recognized. 5. The residual value for the plantassets after the asset has been depreciated for 7 years. 6. Usingthe information presented at the beginning of the exercise 2,determine the five items assuming asset depreciation and using thedouble-declining method of recognizing depreciation. 7. Using theinformation presented at the beginning of the exercise 2, determinethe five items assuming asset depreciation and using the sum of theyears' digits method.
Exercise: 2 A plant assets required at a total cost of $37,500has an estimated scrap value of $2,500 and an anticipated usefullife of 7 years. Determine: 1. The annual rate (expressed as apercentage or fraction) of depreciation using thestraight-line-method. 2. The annual depreciation using the straightline method. 3. The first year's straight-line depreciation,assuming that the asset was acquired 3 months into the currentaccounting period. 4. Continuing with assumption (3), the value ofthe accumulated depreciation account after the second year'sdepreciation is recognized. 5. The residual value for the plantassets after the asset has been depreciated for 7 years. 6. Usingthe information presented at the beginning of the exercise 2,determine the five items assuming asset depreciation and using thedouble-declining method of recognizing depreciation. 7. Using theinformation presented at the beginning of the exercise 2, determinethe five items assuming asset depreciation and using the sum of theyears' digits method.
