Mayo Corp.has estimated that total depreciation expense for the year ending December 31, 2011 will amount to $300,000, and that 2011 year-end bonuses to employees will total $600,000.In Mayo's interim income statement for the six months ended June 30, 2011, what is the total amount of expense relating to these two items that should be reported?

Question

Quizplus · Accepted Answer

The total expense for the six months should include half of the annual depreciation and half of the annual bonuses, which is $150,000 (depreciation) + $300,000 (bonuses) = $450,000.

Mayo CorpHas Estimated That Total Depreciation Expense for the Year Ending