The December 31, 2013 Statement of Financial Position of Cooper

question 142

Essay

The December 31, 2013 statement of financial position of Cooper Company showed Equipment of €80,000 and Accumulated Depreciation of €22,000. On January 1, 2014, the company decided that the equipment has a remaining useful life of 6 years with a €4,000 residual value.
Instructions
Compute the (a) depreciable cost of the equipment and (b) revised annual depreciation.

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Definitions:

Transfer Prices

Prices charged for the sale of goods or services between departments or subdivisions of the same company.

Variable Cost

Expenses that fluctuate in direct proportion to the production or sales volume, including the costs of raw materials and direct labor.

Outside Supplier

A company or entity that provides goods or services to another company but is not part of that company's corporate structure.

Packing And Shipping Costs

Expenses associated with preparing and sending goods to customers, including materials for packing and freight charges.