Use the Following Information for Questions
a Schedule of Machinery

question 65

Multiple Choice

Use the following information for questions
A schedule of machinery owned by Dougan Co.is presented below: $$\begin{array} { l c c c } & \text { Total Cost } & \begin{array} { c } \text { Estimated } \\\text { Salvage Value }\end{array} & \begin{array} { c } \text { Estimated } \\\text { Life in Years }\end{array} \\\hline \text { Machine A } & \$ 320,000 & \$ 20,000 & 12 \\\text { Machine C } & 390,000 & 30,000 & 10 \\\text { Machine M } & 225,000 & 15,000 & 6\end{array}$$ Dougan computes depreciation by the composite method.
-The composite rate of depreciation (in percent) for these assets is

• A)10.27.
• B)10.72.
• C)11.03.
• D)11.67.

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Definitions:

Income Statement Items

Elements found in the income statement, including revenues, expenses, gains, and losses, which together determine the net income of a company.

Average Rate

The mean amount at which something can be bought or sold, calculated over a specified period or under certain conditions.

Functional Currency

The primary currency used by a business or unit in its financial statements, reflecting the main economic environment in which it operates.

Exchange Gains

Profits resulting from holding or transacting in foreign currencies when exchange rates move favorably.