Excel Assignment #5

ACCT 20100 Spring 2017

Depreciation of Long-term Assets

Assume that your company purchased equipment costing $850,000 with a residual
value of $70,000 and a useful life of 7 years or 1,530,000 units.

1) Assume the equipment was purchased on January 1, 2010. Prepare a

depreciation schedule to calculate depreciation expense, accumulated
depreciation, and book value for the useful life of the asset using the
Straight-line method, the Units of Production method, and the Double
Declining Balance method.

2) Assume the equipment was purchased on August 1, 2010. Prepare a

depreciation schedule to calculate depreciation expense, accumulated
depreciation, and book value for the useful life of the asset using the
Straight-line method, the Units of Production method, and the Double
Declining Balance method.

3) Assume that the equipment was purchased on January 1, 2010. Further,

assume that the equipment was sold on April 30, 2014 for $220,000.
Calculate the depreciation for 2014 on the asset using the Straight-line
method, the Units of Production method, and the Double Declining Balance
method. Further, calculate the accumulated depreciation, the book value and
the amount of the gain or loss as of April 30, 2014 using the Straight-line
method, the Units of Production method, and the Double Declining Balance
method.

4) Assume that the equipment was purchased on January 1, 2010 and you use
the straight-line method to calculate depreciation. On January 1, 2013 you
had a major overhaul of the equipment performed which cost $175,000 and
extended the useful life through December 31, 2019. You expect that the
equipment will have a residual value on December 31, 2019 of $50,000.
Calculate the new depreciation base for the asset and prepare a new
depreciation schedule for the asset.

5) Assume that the equipment was purchased on January 1, 2010. On

December 31, 2015 you need to perform a test of impairment. Determine
the book value of the asset at December 31, 2015 using the Straight-line

Copyright of Michael J Meyer 2017. Use by permission only.

 method, the Units of Production method, and the Double Declining Balance
method. You determine that the expected future cash flows for the
equipment will be $120,000 and the fair market value of the asset is
$150,000. Determine if there is an impairment using each of the
depreciation methods. If there is impairment, determine the amount of loss
that needs to be recorded. If no loss needs to be recorded, show a zero as
you cannot record a gain.

Excel Rules:

1. You must use the Excel Templates provided on the ACCT

20100 website (www.acct20100.com). Note that each
template is individualized for each student with an ID code
for each student. It will be assumed an Honor Code
VIOLATION if you use a template with someone elses ID
Code.

2. You must use Microsoft EXCEL and not any other spreadsheet
program. Failure to use MS Excel will result in a zero grade.
Files that are not readable by your instructor or the ACCT
20100 website will receive a zero grade. FYI, use of Google
Sheets makes the template unreadable by the ACCT 20100
website.

3. Maximum benefit from this assignment comes from doing it

individually. You must use and upload to the dropbox your
own template.

4. You must use links and formulas where ever possible. Failure
to exploit Excel will result in a zero grade.

5. You must sign your name to the honor code statement (the
first sheet of the Excel template). Failure to sign your name
(by typing your name) will result in a zero grade.

6. You must name your Excel file as: last name first name
Excel 5.

Copyright of Michael J Meyer 2017. Use by permission only.

 7. Completed templates will need to be uploaded to the ACCT
20100 dropbox BEFORE the date and time due.

Copyright of Michael J Meyer 2017. Use by permission only.