专业英语课件chap

1、 The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-1PLANT AND INTANGIBLE ASSETS固定资产和无形资产固定资产和无形资产Chapter9 The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-2Long-lived assets acquired for use in business operations.Similar to long-term prepaid expensesThe cost of plant assets is the adva

2、nce purchase of services.DateDescriptionDebitCreditAs years pass, and the services are used, the cost is transferred to depreciation expense.Plant Assets 固定资产 The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-3Major Categories of Plant AssetsLand, buildings,equipment,furniture, fixtures.Long-t

3、ermassets havingphysical substance.Tangible PlantAssetsPatents, copyrights,trademarks,franchises, goodwill.Noncurrent assetswith no physicalsubstance.IntangibleAssetsOil reserves,timber, otherminerals.Sites acquired forextracting valuableresources.NaturalResources The McGraw-Hill Companies, Inc., 20

4、05McGraw-Hill/Irwin9-4Acquisition.Allocation of the acquisition cost to expense over the assets useful life (depreciation).Sale or disposal.Accountable Events The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-5Asset price . . . for getting the asset to the desired location. . . . for getting t

5、he asset ready for use.CostAcquisition of Plant Assets=Reasonable and necessary costs . . . + The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-6On May 4, Heat Co., an Ohio maker of stoves, buys a new machine from a Texas company. The new machine has a price of $52,000. Sales tax was computed

6、at 8%.Heat Co. pays $500 shipping cost to get the machine to Ohio. After the machine arrives, set-up costs of $1,300 are incurred, along with $4,000 in testing costs.Compute the cost of Heat Co.s new machine.Determining Cost The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-7DateDescriptionDeb

7、itCreditPrepare the journal entry.Determining CostDateDescriptionDebitCreditMay 4 New Machine61,960 Cash61,960 The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-8Improvements to land such as driveways, fences, and landscaping are recorded separately.Cost includes real estate commissions, escro

8、w fees, legal fees, clearing and grading the property.Land ImprovementsLandSpecial Considerations The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-9Repairs made prior to the building being put in use are considered part of the buildings cost.BuildingsSpecial ConsiderationsEquipmentRelated int

9、erest, insurance, and property taxes are treated as expenses of the current period. The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-10I think Ill buy the whole thing; barn, land, and animals.Special ConsiderationsThe allocation is based on the relative Fair Market Value of each asset purchas

10、ed.The total cost must be allocated to separate accounts for each asset.Allocation of a Lump-Sum Purchase The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-11CapitalExpenditureRevenueExpenditureAny material expenditurethat will benefit severalaccounting periods.To capitalize an expendituremean

11、s to charge it to anasset account.Expenditure forordinary repairsand maintenance.To expense an expendituremeans to charge it to anexpense account.Capital Expenditures and Revenue Expenditures资本性支出和经营性支出 The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-12Exercise Exercise 9.2 on page 400 (to b

12、e done in class)Discuss question 6 on page 398 (to be done in class) The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-13The allocation of the cost of a plant asset to expense in the periods in which services are received from the asset.Cost of plant assetsBalance SheetAssets: Plant and equipm

13、entIncome StatementRevenues:Expenses: Depreciationas the services are receivedDepreciation（折旧） The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-14Book Value（帐面价值）（帐面价值）lCost Accumulated DepreciationAccumulated Depreciation（累计折旧）（累计折旧）lContra-assetlRepresents the portion of an assets cost that

14、 has alreadybeen allocated to expense.Causes of DepreciationlPhysical deteriorationlObsolescenceDepreciation The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-15Cost - Residual ValueYears of Useful Life DepreciationExpense per Year=Straight-Line Depreciation(直线法) The McGraw-Hill Companies, Inc

15、., 2005McGraw-Hill/Irwin9-16On January 1, 2005, Bass Co. buys a new boat. Bass Co. pays $24,000 for the boat. The boat has an estimated residual value of $3,000 and an estimated useful life of 5 years.Compute depreciation for 2005 using the straight-line method.Straight-Line Depreciation The McGraw-

16、Hill Companies, Inc., 2005McGraw-Hill/Irwin9-17DepreciationAccumulatedAccumulatedUndepreciatedExpenseDepreciationDepreciationBalanceYear(debit)(credit)Balance(book value)24,000$ 20054,200$ 4,200$ 4,200$ 19,800 20064,200 4,200 8,400 15,600 20074,200 4,200 12,600 11,400 20084,200 4,200 16,800 7,200 20

17、094,200 4,200 21,000 3,000 21,000$ 21,000$ Bass Co. will record $4,200 depreciation each year for five years. Total depreciation over the estimated useful life of the boat is:Salvage ValueStraight-Line Depreciation The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-18When an asset is acquired d

18、uring the year, depreciation in the year of acquisition must be prorated.Half-Year ConventionIn the year of acquisition, record six months of depreciation.Depreciation for Fractional Periods The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-19Half-Year ConventionUsing the half-year convention,

19、 calculate the straight-line depreciation on December 31, 2005, for equipment purchased in 2005. The equipment cost $75,000, has a useful life of 10 years and an estimated salvage value of $5,000.Depreciation= ($75,000 - $5,000) 10= $7,000 for a full yearDepreciation = $7,000 1/2 = $3,500Example on

20、page 375 The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-20Depreciation in the early years of an assets estimated useful life is higher than in later years.The double-declining balance depreciation rate is 200% of the straight-line depreciation rate of 1/Useful Life.Declining-Balance Method(

21、余额递减法) The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-21On January 1, 2005, Bass Co. buys a new boat. Bass Co. pays $24,000 for the boat. The boat has an estimated residual value of $3,000 and an estimated useful life of 5 years.Compute depreciation for 2005 using the double-declining balan

22、ce method.Declining-Balance Method2005 Depr. Expense =Remaining Book ValueAccelerated Depreciation Rate =24,000$ 2 1/5 =24,000$ 40% =9,600$ The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-22Compute depreciation for the rest of the boats estimated useful life. Declining-Balance Method The McG

23、raw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-23Compute depreciation for the rest of the boats estimated useful life. YearComputationDepr. ExpenseAccumulated DepreciationBook Value200524,000$ 40%9,600$ 9,600$ 14,400$ 200614,400$ 40%5,760$ 15,360$ 8,640$ 20078,640$ 40%3,456$ 18,816$ 5,184$ 20085,1

24、84$ 40%2,074$ 20,890$ 3,110$ 2009110$ 21,000$ 3,000$ Total Depreciation21,000$ Plug year # 5Declining-Balance MethodTotal depreciation over the estimated useful life of an asset is the same using either the straight-line method or the declining-balance method. The McGraw-Hill Companies, Inc., 2005Mc

25、Graw-Hill/Irwin9-24Declining-Balance Method Double-Declining-Balance(双倍余额递减法) Refer to exhibit 9-5 on page 377150 percent Declining-Balance Refer to exhibit 9-6 on page 378Straight-line method Refer to exhibit 9-3 on page 372 The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-25Declining-Balanc

26、e Method Both accelerated methods result in a higher depreciation expense than the straight-line method in the first two years of the assets life. This pattern reverses in years 3 through 5. Nearly 99% of the assets total depreciation expense has been recorded under the 200% declining-balance method

27、, Only 80% of the assets total depreciation expense has been recorded under the 150% declining-balance method, therefore we will switch to straight-line method to result in a larger depreciation in the remain two years. The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-26Exercise & Assignm

28、ent Exercise 9.4 a ,2, 3on page 400 (to be done in class )Exercise 9.3 on page 400 Assignment problem 9.2 on page 403 group 9 will present The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-27Estimates of Useful Life and Residual ValuelMay differ from company to company.lThe reasonableness of m

29、anagements estimates is evaluated by external auditors.Principle of ConsistencylCompanies should avoid switching depreciation methods from period to period.Financial Statement Disclosures The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-28So depreciationis an estimate.Predicted salvage valueP

30、redicteduseful life Over the life of an asset, new information may come to light that indicates theoriginal estimates need to be revised.Revising Depreciation Rates The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-29Revising Depreciation RatesOn January 1, 2002, equipment was purchased that c

31、ost $30,000, has a useful life of 10 years and no salvage value. During 2005, the useful life was revised to 8 years total (5 years remaining). Calculate depreciation expense for the year ended December 31, 2005, using the straight-line method. The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9

32、-30 When our estimates change, depreciation is:Book value at date of changeSalvage value at date of changeRemaining useful life at date of changeRevising Depreciation Rates The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-31If the cost of an asset cannot be recovered through future use or sal

33、e, the asset should be written down to its net realizable value.Impairment of Plant Assets(资产减值) The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-32Update depreciation to the date of disposal.Recording cashreceived (debit).Removing accumulateddepreciation (debit).Removing the asset cost (cred

34、it).Recording again (credit)or loss (debit).Disposal of Plant and Equipment固定资产处置 Journalize disposal by: The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-33If Cash BV, record a gain (credit).If Cash BV, record a loss (debit).If Cash = BV, no gain or loss.Recording cashreceived (debit).Removi

35、ng accumulateddepreciation (debit).Removing the asset cost (credit).Recording again (credit)or loss (debit).Disposal of Plant and Equipment The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-34 On September 30, 2005, Evans Map Company sells a machine that originally cost $100,000 for $60,000 ca

36、sh. The machine was placed in service on January 1, 2000. It has been depreciated using the straight-line method with an estimated salvage value of $20,000 and an estimated useful life of 10 years.Lets answer the following questions. Disposal of Plant and Equipment The McGraw-Hill Companies, Inc., 2

37、005McGraw-Hill/Irwin9-35The amount of depreciation recorded on September 30, 2005,to bring depreciation up to date is:a. $8,000.b. $6,000.c. $4,000.d. $2,000.Annual Depreciation:($100,000 - $20,000) 10 Yrs. = $8,000Depreciation to Sept. 30:9/12 $8,000 = $6,000 Disposal of Plant and Equipment The McG

38、raw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-36 After updating the depreciation, the machines book value on September 30, 2005, is:a. $54,000.b. $46,000.c. $40,000.d. $60,000.Disposal of Plant and Equipment The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-37The machines sale resulted in:

39、a. a gain of $6,000.b. a gain of $4,000.c. a loss of $6,000.d. a loss of $4,000.Cost100,000$ Accum. Depr.46,000 Book value54,000$ Cash received60,000 Gain6,000$ Disposal of Plant and Equipment The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-38DateDescriptionDebitCreditDisposal of Plant and E

40、quipmentDateDescriptionDebitCreditSept. 30 Cash60,000 Accumulated Depreciation46,000 Gain on Sale6,000 Machinery100,000 Prepare the journal entry to record the sale. The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-39 On September 30, 2005, Evans Map Company sells a machine that originally co

41、st $100,000 for $50,000 cash. The machine was placed in service on January 1, 2000. It has been depreciated using the straight-line method with an estimated salvage value of $20,000 and an estimated useful life of 10 years.Lets answer the following questions. Disposal of Plant and Equipment The McGr

42、aw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-40The machines sale resulted in: a. a gain of $6,000.b. a gain of $4,000.c. a loss of $6,000.d. a loss of $4,000.Disposal of Plant and Equipment The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-41DateDescriptionDebitCreditDisposal of Plant and E

43、quipment Prepare the journal entry to record the sale. The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-42 Accounting depends on whetherassets are similar or dissimilar.AirplaneforAirplaneTruckforAirplane Only situations where cash is paid will be demonstrated. example on page 382Trading in U

44、sed Assetsfor New Ones(固定资产以旧换新) The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-43Noncurrent assetswithout physicalsubstance.Useful life isoften difficultto determine.Usually acquired for operational use. Often provideexclusive rightsor privileges.Intangible AssetsCharacteristics The McGraw

45、-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-44 Patents Copyrights Leaseholds Leasehold Improvements Goodwill Trademarks and Trade Names Record at current cash equivalent cost, including purchase price, legal fees, and filing fees.Intangible Assets The McGraw-Hill Companies, Inc., 2005McGraw-Hill/I

46、rwin9-45Amortization is the systematic write-off to expense of the cost of intangible assets over Their useful life or legal life, whichever is shorter. Use the straight-line method to amortize most intangible assets.AmortizationDateDescriptionDebitCreditAmortization Expense # Intangible Asset # The

47、 McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-46The amount by which thepurchase price exceeds the fairmarket value of net assets acquired.Occurs when onecompany buysanother company.Only purchased goodwill is an intangible asset.GoodwillGoodwill is NOT amortized. It is tested annually to deter

48、mine if there has been an impairment loss. The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-47 Exclusive right grantedby federal government to sell or manufacture an invention. Cost is purchaseprice plus legalcost to defend.Amortize costover the shorter ofuseful life or 20 years.Patents The M

49、cGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-48 A symbol, design, or logo associated with a business.Purchasedtrademarksare recordedat cost, andamortized overshorter of legalor economic life,or 40 years.Internallydevelopedtrademarkshave norecordedasset cost.Trademarks and Trade Names The McGra

50、w-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-49 Legally protected right to sell products or provide services purchased by franchisee from franchisor. Purchase price is intangible asset which is amortized over the shorter of the protected right or useful life.Franchises The McGraw-Hill Companies, Inc., 2005McGraw-Hill/Irwin9-50