Explore Westonci.ca, the leading Q&A site where experts provide accurate and helpful answers to all your questions. Discover a wealth of knowledge from experts across different disciplines on our comprehensive Q&A platform. Get precise and detailed answers to your questions from a knowledgeable community of experts on our Q&A platform.
Sagot :
To determine the revised annual depreciation for each asset in 2022, we'll follow a structured approach. We'll need to calculate the remaining useful life of each asset, the book value at the beginning of 2022, and then use the straight-line depreciation method to find the revised annual depreciation. Let's go through the process step-by-step.
### Step 1: Extract and Understand the Given Information
For each asset (Building and Warehouse), we have the following details:
Building:
- Date Acquired: January 1, 2014
- Cost: [tex]$700,000 - Accumulated Depreciation as of January 1, 2022: $[/tex]130,000
- Original Useful Life: 40 years
Warehouse:
- Date Acquired: January 1, 2017
- Cost: [tex]$120,000 - Accumulated Depreciation as of January 1, 2022: $[/tex]23,000
- Original Useful Life: 25 years
### Step 2: Calculate the Remaining Useful Life
Calculate the years elapsed for each asset up to January 1, 2022, and then find the remaining useful life.
Building:
- Years Elapsed (2022 - 2014) = 8 years
- Original Useful Life = 40 years
- Remaining Useful Life = 40 - 8 = 32 years
Warehouse:
- Years Elapsed (2022 - 2017) = 5 years
- Original Useful Life = 25 years
- Remaining Useful Life = 25 - 5 = 20 years
### Step 3: Compute the Book Value as of January 1, 2022
Subtract the accumulated depreciation from the cost of each asset to get the book value.
Building:
- Cost = [tex]$700,000 - Accumulated Depreciation = $[/tex]130,000
- Book Value = [tex]$700,000 - $[/tex]130,000 = [tex]$570,000 Warehouse: - Cost = $[/tex]120,000
- Accumulated Depreciation = [tex]$23,000 - Book Value = $[/tex]120,000 - [tex]$23,000 = $[/tex]97,000
### Step 4: Calculate the Revised Annual Depreciation
Using the straight-line method, divide the book value by the remaining useful life to get the annual depreciation amount.
Building:
- Book Value = [tex]$570,000 - Remaining Useful Life = 32 years - Revised Annual Depreciation = $[/tex]570,000 / 32 ≈ [tex]$17,812.5 Warehouse: - Book Value = $[/tex]97,000
- Remaining Useful Life = 20 years
- Revised Annual Depreciation = [tex]$97,000 / 20 = $[/tex]4,850.0
### Final Answer:
The revised annual depreciation on each asset in 2022 is as follows:
- Building: \[tex]$17,812.5 - Warehouse: \$[/tex]4,850.0
### Step 1: Extract and Understand the Given Information
For each asset (Building and Warehouse), we have the following details:
Building:
- Date Acquired: January 1, 2014
- Cost: [tex]$700,000 - Accumulated Depreciation as of January 1, 2022: $[/tex]130,000
- Original Useful Life: 40 years
Warehouse:
- Date Acquired: January 1, 2017
- Cost: [tex]$120,000 - Accumulated Depreciation as of January 1, 2022: $[/tex]23,000
- Original Useful Life: 25 years
### Step 2: Calculate the Remaining Useful Life
Calculate the years elapsed for each asset up to January 1, 2022, and then find the remaining useful life.
Building:
- Years Elapsed (2022 - 2014) = 8 years
- Original Useful Life = 40 years
- Remaining Useful Life = 40 - 8 = 32 years
Warehouse:
- Years Elapsed (2022 - 2017) = 5 years
- Original Useful Life = 25 years
- Remaining Useful Life = 25 - 5 = 20 years
### Step 3: Compute the Book Value as of January 1, 2022
Subtract the accumulated depreciation from the cost of each asset to get the book value.
Building:
- Cost = [tex]$700,000 - Accumulated Depreciation = $[/tex]130,000
- Book Value = [tex]$700,000 - $[/tex]130,000 = [tex]$570,000 Warehouse: - Cost = $[/tex]120,000
- Accumulated Depreciation = [tex]$23,000 - Book Value = $[/tex]120,000 - [tex]$23,000 = $[/tex]97,000
### Step 4: Calculate the Revised Annual Depreciation
Using the straight-line method, divide the book value by the remaining useful life to get the annual depreciation amount.
Building:
- Book Value = [tex]$570,000 - Remaining Useful Life = 32 years - Revised Annual Depreciation = $[/tex]570,000 / 32 ≈ [tex]$17,812.5 Warehouse: - Book Value = $[/tex]97,000
- Remaining Useful Life = 20 years
- Revised Annual Depreciation = [tex]$97,000 / 20 = $[/tex]4,850.0
### Final Answer:
The revised annual depreciation on each asset in 2022 is as follows:
- Building: \[tex]$17,812.5 - Warehouse: \$[/tex]4,850.0
We appreciate your time. Please come back anytime for the latest information and answers to your questions. We appreciate your time. Please come back anytime for the latest information and answers to your questions. Westonci.ca is here to provide the answers you seek. Return often for more expert solutions.