Question: Samson Company purchased a computer on January 2, 2009, at a cost of $1,250. The computer is expected to have a useful life of five years and a residual value of $125. Assume that the computer is disposed of on July 1, 2012. Record the depreciation expense for half a year and the disposal under each of the following assumptions:
1. The computer is discarded.
2. The computer is sold for $200.
3. The computer is sold for $550.
Natural Resource Depletion and Depreciation of Related Plant Assets
Question 2: Nelson Company purchased land containing an estimated 2.5 million tons of ore for a cost of $4,400,000. The land without the ore is estimated to be worth $250,000. During its first year of operation, the company mined and sold 375,000 tons of ore. Compute the depletion charge per ton. Compute the depletion expense that Nelson should record for the year.