Basilia Corporation Purchased a Machine for $180,000 on January 1,2013

question 33

Multiple Choice

Basilia Corporation purchased a machine for $180,000 on January 1,2013.Basilia will depreciate the machine using the straight-line method using a five-year period with no residual value.As a result of an error in its purchasing records,Basilia did not recognize any depreciation for the machine in its 2013 financial statements.Basilia discovered the problem during the preparation of its 2014 financial statements.What amount should Basilia record for depreciation expense on this machine for 2014?

• A)$0
• B)$36,000
• C)$44,000
• D)$72,000

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Definitions:

Bailee

A bailee is a person or party to whom goods are delivered for a specific purpose, under an agreement or contract, with the obligation to return the goods after the purpose is fulfilled.

In Transit

Refers to goods or individuals that are in the process of being transported from one location to another.

Nonconforming Goods

Refers to products or goods delivered under a contract that fail to meet the specifications or standards agreed upon.

Acceptance

The act of agreeing to the terms of an offer, thus creating a binding contract between the parties.