COMMERCE 1AA3 Study Guide - Final Guide: Accounts Payable, Promissory Note, Current Liability
24 Oct 2018
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Date: a change in estimate should result in restatement of prior period statements. D) less than book value: driesell corp. has been in existence several years. Xyz will pay the bill after two weeks. Pierce co. purchased land as a factory site for ,000. Pierce paid ,000 to tear down two buildings on the land. Legal fees of ,740 were paid for title investigation and making the purchase. ,200, and liability insurance during construction cost ,300. An assessment made by the city for pavement was ,200. The machine was estimated to have a useful life of 10 years with an estimated residual value of ,000. During 2006, it became apparent that the machine would become uneconomical after. December 31, 2010, and that the machine would have no salvage value. Accumulated amortization on this machine as of december 31, 2005, was ,000. What should be the charge for amortization in 2006 under generally accepted accounting principles: ,400, ,200, ,000, ,750.
