On October 1, 2012, Ming Wo Ltd

question 1

Multiple Choice

On October 1, 2012, Ming Wo Ltd. places a new asset into service. The cost of the asset is $9,000 with an estimated 5-year life and $1,500 residual value. Assuming that Ming Wo uses the double diminishing-balance method of depreciation, what is the carrying amount of the asset at December 31, 2012?

• A)$8,100
• B)$6,750
• C)$6,000
• D)$5,400

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Definitions:

Customer

An individual or business that purchases goods or services from a company.

Retailer

A business or individual that sells goods or services directly to consumers, acting as the final link in the supply chain.

In-Transit Merge

Logistics strategy where goods from different suppliers are combined into a single shipment en route to the customer to reduce handling costs and improve efficiency.

Drop-Shipping

A retail fulfillment method where a store doesn't keep the products it sells in stock but instead transfers the customer orders and shipment details to either the manufacturer or a wholesaler, who then ships the goods directly to the customer.