ACC 556 WEEK 6 DISCUSSION

ACC 556 WEEK 6 DISCUSSION

"Plant Assets"  Please respond to the following:

 Determine straight line depreciation for partial period  

Vinxet Company purchased a new machine on October 1, 2017, at a cost of $90,000.  The company

estimated that the machine has a salvage value of $8,000.  The machine is expected to be used for 

70,000 working hours during its 8-year life.

Notice that Vinxet uses December 31 as its year end, and this purchase is made in October.  

   

Instructions  

Compute the depreciation expense under the straight-line method for 2017 and 2018, assuming a  

December 31 year-end.  

EXTRA CREDIT +5

Explain the consequences of recording a capital expenditure as an ordinary expense. Use numbers to illustrate your understanding. 

NOTE: MORE THAN ONE VERSION POSTED AS A BONUS CHOOSE ANY