Barnes Company Purchased a Machine on April 4, 2011, for $210,000

question 119

Multiple Choice

Barnes Company purchased a machine on April 4, 2011, for $210,000. The machine had an estimated useful life of five years and a salvage value of $30,000. The machine is being depreciated using the double-declining-balance method. Barnes depreciates its assets from the first day of the month nearest the date of purchase. The asset balance, net of accumulated depreciation, at December 31, 2012, should be:

• A) $105,600
• B) $75,600
• C) $88,200
• D) $94,800

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Definitions:

Balance Budget

A balanced budget occurs when the total revenues equal total expenditures for a government within a specific fiscal period, eliminating deficits.

Fiscal Policy

Government policies related to taxation and government spending that influence economic conditions.

Fiscal Policy

Government policies regarding taxation and spending that are employed to influence economic conditions, including stimulating or restraining economic growth.

Multiplier

An economic factor that quantifies the additional effect on income or output resulting from an injection of spending.