Cola Company Purchased a Bottling Machine on October 1,2018 for $250,000.The

question 19

Multiple Choice

Cola Company purchased a bottling machine on October 1,2018 for $250,000.The estimated useful life is 25 years and they are using straight-line depreciation.On October 1,2019,they spent $46,000 on the machine to double its capacity and $5,000 on routine cleaning.The company's year end is September 30.What should the depreciation expense be at September 30,2020?

• A)$10,000
• B)$30,000
• C)$12,200
• D)$11,9170

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Definitions:

Cash Flow

The aggregated sum of money being circulated in and out of a firm, importantly influencing its liquid financial resources.

Creditors

Entities or individuals that lend money or extend credit to others, expecting repayment in the future.

Stockholders

Individuals or entities that own shares of a corporation, giving them certain rights and potential for profit in the form of dividends and stock value appreciation.

Net Capital Spending

The total spending on new capital assets minus the sales of disposed or obsolete assets.