Hawaiian Specialty Foods purchased equipment for $14,000. Residual value at the end of an estimated four-year service life isexpected to be $1,400. The machine operated for 1.900 hours in the first year, and the company expects the machine to operate for atotal of 12.000 hours.Calculate depreciation expense for the first year using each of the following depreciation methods: (1) straight-line. (2) double-declining-balance, and (3) activity-based. (Do not round your intermediate calculations.)(1) Straight-line(2) Double-declining-balance(3) Activity-basedDepreciationExpense

Straight Line Method(SLM): Under this method, a fixed portion of the asset is depreciated every…

Calculate depreciation expense for the first year using each of the following depreciation methods: (1) straight-line. (2) double- declining-balance, and (3) activity-based. (Do not round your intermediate calculations.) (1) Straight-line (2) Double-declining-balance (3) Activity-based Depreciation Expense

Calculate depreciation expense for the first year using each of the following depreciation methods: (1) straight-line. (2) double- declining-balance, and (3) activity-based. (Do not round your intermediate calculations.) (1) Straight-line (2) Double-declining-balance (3) Activity-based Depreciation Expense

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter18: Accounting For Long-term Assets

Section: Chapter Questions

Problem 3CE: A machine costing 350,000 has a salvage value of 15,000 and an estimated life of three years....

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A machine costing 350,000 has a salvage value of 15,000 and an estimated life of three years. Prepare depreciation schedules reporting the depreciation expense, accumulated depreciation, and book value of the machine for each year under the double-declining-balance and sum-of-the-years-digits methods. For the double-declining-balance method, round the depreciation rate to two decimal places.
Colquhoun International purchases a warehouse for $300,000. The best estimate of the salvage value at the time of purchase was $15,000, and it is expected to be used for twenty-five years. Colquhoun uses the straight-line depreciation method for all warehouse buildings. After four years of recording depreciation, Colquhoun determines that the warehouse will be useful for only another fifteen years. Calculate annual depreciation expense for the first four years. Determine the depreciation expense for the final fifteen years of the assets life, and create the journal entry for year five.
Urquhart Global purchases a building to house its administrative offices for $500,000. The best estimate of the salvage value at the time of purchase was $45,000, and it is expected to be used for forty years. Urquhart uses the straight-line depreciation method for all buildings. After ten years of recording depreciation, Urquhart determines that the building will be useful for a total of fifty years instead of forty. Calculate annual depreciation expense for the first ten years. Determine the depreciation expense for the final forty years of the assets life, and create the journal entry for year eleven.
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Utica Machinery Company purchases an asset for 1,200,000. After the machine has been used for 25,000 hours, the company expects to sell the asset for 150,000. What is the depreciation rate per hour based on activity?
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