Companies that have a relatively large amount invested in assets to generate a given level of sales are considered capital-intensive.

Minor Company installs a machine in its factory at the beginning of the year at a cost of $135,000. The machine’s useful life is estimated to be 5 years, or 300,000 units of product, with a $15,000 salvage value. During its first year, the machine produces 64,500 units of product. What journal entry would be needed to record the machines’ first year depreciation under the units-of-production method?

On July 1, Shady Creek Resort borrowed $250,000 cash by signing a 10-year, 8% installment note requiring equal payments each June 30 of $37,258. What amount of interest expense will be included in the first annual payment?

Depletion is the process of allocating the cost of natural resources to periods when they are consumed.

On January 1, a company issued and sold a $400,000, 7%, 10-year bond payable, and received proceeds of $396,000. Interest is payable each June 30 and December 31. The company uses the straight-line method to amortize the discount. The journal entry to record the first interest payment is:

The carrying (book) value of a bond payable is the par value of the bonds plus any discount or minus any premium.

Charger Company’s most recent balance sheet reports total assets of $27,000,000, total liabilities of $15,000,000 and total equity of $12,000,000. The debt to equity ratio for the period is (rounded to two decimals):

Recording employee payroll deductions may involve:

On November 1, Alan Company signed a 120-day, 8% note payable, with a face value of $9,000. What is the maturity value of the note on March 1? (Use 360 days a year.)

The carrying (book) value of a bond payable is the par value of the bonds plus any discount or minus any premium.