Check my work Grove Company acquired a production machine on January 1, 2022, at a cost of $720,000. The machine is expected to have a four-year useful life, with a salvage value of $120,000. The machine is capable of producing 100,000 units of product in its lifetime. Actual production was as follows: 22,000 units in 2022; 32,000 units in 2023; 28,000 units in 2024; 18,000 units in 2025. Following is the comparative balance sheet presentation of the net book value of the production machine at December 31 for each year of the asset's life, using three alternative depreciation methods (items a to c): Required: Identify the depreciation method used for each of the following comparative balance sheet presentations (items a to c). If a declining-balance method is used, be sure to indicate the percentage (150% or 200%). (Hint: Read the balance sheet from right to left to determine how much has been depreciated each year. Remember that December 31, 2022, is the end of the first year.) a. b. C. Production Machine, Net of Accumulated Depreciation Depreciation Method 2025 At December 31 2024 2023 2022 120,000 270,000 420,000 570,000 120,000 120,000 228,000 396,000 588,000 120,000 180,000 360,000
Check my work Grove Company acquired a production machine on January 1, 2022, at a cost of $720,000. The machine is expected to have a four-year useful life, with a salvage value of $120,000. The machine is capable of producing 100,000 units of product in its lifetime. Actual production was as follows: 22,000 units in 2022; 32,000 units in 2023; 28,000 units in 2024; 18,000 units in 2025. Following is the comparative balance sheet presentation of the net book value of the production machine at December 31 for each year of the asset's life, using three alternative depreciation methods (items a to c): Required: Identify the depreciation method used for each of the following comparative balance sheet presentations (items a to c). If a declining-balance method is used, be sure to indicate the percentage (150% or 200%). (Hint: Read the balance sheet from right to left to determine how much has been depreciated each year. Remember that December 31, 2022, is the end of the first year.) a. b. C. Production Machine, Net of Accumulated Depreciation Depreciation Method 2025 At December 31 2024 2023 2022 120,000 270,000 420,000 570,000 120,000 120,000 228,000 396,000 588,000 120,000 180,000 360,000
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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