Water Company Purchased a Bottling Machine on October 1, 2009

question 45

Multiple Choice

Water Company purchased a bottling machine on October 1, 2009 for $250,000.The estimated useful life is 25 years and they are using straight-line amortization.During 2011, they spent $46,000 on the machine to double its capacity and $5,000 on routine cleaning.What should the amortization expense be at September 30, 2011? The company's year end is September 30.

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

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Definitions:

Collective Bargaining

Collective bargaining is the process through which employees, typically organized in a union, negotiate contracts with their employers regarding wages, working conditions, benefits, and other employment terms.

Labor Unions

Labor unions are organizations that represent workers in negotiations with employers regarding wages, working conditions, and benefits.

Cartels

An association of manufacturers or suppliers with the purpose of maintaining prices at a high level and restricting competition.

Non-Unionized Industries

Sectors of the economy where labor unions do not represent the workforce, often resulting in different labor standards and wages.