Answer 1 :-
Under Double declining value, salvage value is ignored.
SLM depreciation = 46000 / 4 = $ 11500
SLM dep. rate = 11500 / 46000 = 25 %
DDB rate = 25 * 2 = 50 %
DDB dep. ( 2015 ) = 46000 * 50 % = $ 23000
Book value ( dec. 31, 2015 ) = 46000 – 23000 = $ 23000
Now, Dep. ( 2016 ) = 23000 * 50 % = 11500
Book value ( dec. 31, 2016 ) = $ 23000 – 11500 = $ 11500
Option D is correct.
Note :- DDB dep. is always calculated on opening book value.
Answer 2 :-
Option C is correct.
Prepaid expenses always become asset since they are paid in advance and therefore prepaid rent will be debited. Since cash was paid , therefore, cash goes out and it is credited.
Answer 3 :-
The transactions related to PPE form part of cash flow from / used in investing activities.
The transactions related to working capital like inventory, accounts receivable etc. form part of cash flow from / used in operating activities.
The transactions related to financing of a company form part of cash flow from / used in financing activities.
Here the required answer is An inflow of $ 3 million ( option C ) since bonds payable were increased by $ 3 million which means funds were raised through issuance of bonds.
Answer 4 :-
NUmber of issued shares = 15 million shares ( option C )
But number of outstanding shares = 15 million shares – 4.5 million shares = 10.5 million shares