Fle Edit View Favenites Toc dp On January 1, 2015, a machine was purchased for $
ID: 2515582 • Letter: F
Question
Fle Edit View Favenites Toc dp On January 1, 2015, a machine was purchased for $100,800. The machine has an estimated salvage value of replaced. The company closed its books on December 31 and operates the machine as follows: 2015, 22,400 hrs and an estimated useful life of 5 years. The machine can operate for 112,000 hours before it needs to be 2016, 28,000 hrs; 2017, 16,800 hrs; 2018, 33,600 hrs; and 2019, 11,200 hrs. g. 16e Your answer is incorrect. Try again. following depreciation methods. (Round answers to 0 decimal (1) Straight-ine Method adable Compute the annual depreciation charges over the machine's life assuming a December 31 year places, e.g. 45,892.) (2) Activity Method Year d for $100,s ows: 2015, 2015 2016 2017 2018 2019 (3) Sum-of-the-Years-Digits Method 2015 2016 2017 2018 2019 2015 2016 2017 2018Explanation / Answer
Solution 1:
Original cost = $100,800
Salvage value = $6,720
Depreciable cost = $100,800 - $6,720 = $94,080
Life = 5years
Annual depreciation - SLM = $94,080 / 5 = $18,816
Depreciation rate - SLM = $18,816 / $94,080 = 20%
Solution 2:
Depreciation rate per unit (Activity method) = Depreciable cost / Estimated nos of units
= $94,080 / 112000 = 0. 84 per hour
Solution 3:
Solution 4:
Depreciation rate double declining = 20% * 2 = 40%
Depreciation Schedule - Unit of Production Date Asset Cost Depreciation per unit Nos of units Depreciation Expense for the year Accumulated Depreciation Book Value 1-Jan-15 $100,800.00 31-Dec-15 $0.84 22400 $18,816.00 $18,816.00 $81,984.00 31-Dec-16 $0.84 28000 $23,520.00 $42,336.00 $58,464.00 31-Dec-17 $0.84 16800 $14,112.00 $56,448.00 $44,352.00 31-Dec-18 $0.84 33600 $28,224.00 $84,672.00 $16,128.00 31-Dec-19 $0.84 11200 $9,408.00 $94,080.00 $6,720.00Related Questions
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