Computer Equipment Was Acquired at the Beginning of the Year

question 177

Multiple Choice

Computer equipment was acquired at the beginning of the year at a cost of $57,000 that has an estimated residual value of $9,000 and an estimated useful life of 5 years. Determine the second-year depreciation using the straight-line method.

• A) $13,200
• B) $19,200
• C) $9,600
• D) $9,000

Distinguish between current and long-term assets and liabilities.

Understand the basics of working capital management and its significance in financial management.

Identify various sources of short-term financing and understand their uses and costs.

Identify and classify types of assets and liabilities in a business context.

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Definitions:

Units Sold

The total quantity of a company's product that was sold during a specified period.

Prime Cost

The total of direct materials plus direct labor expenses linked to the manufacturing of products.

Variable Cost

Costs that vary in direct proportion to changes in levels of production or sales, such as materials and labor directly involved in a product's manufacturing.

Units Sold

The total number of units of product sold within a specific time frame.