Straight-Line, Declining-Balance, Sum-Of-The-Years'-Digits, and MACRS Methods A machine is purchased January 1 at a cost of $59,000. It is expected to serve for eight years and have a salvage value of $3,000. Required: 1. Prepare a schedule showing depreciation for each of the eight years and the book value at the end of each year using the following methods: a. Straight-line Straight-Line Method Annual Ending Year Depreciation Book Value 1 2 3 4 6. 8 b. Double-declining-balance (round to two decimal places) Double-Declining-Balance Method Annual Ending Year Depreciation Book Value 2 3 4 6. 8 c. Sum-of-the-years'-digits (round to two decimal places) Sum-Of-The-Years'-Digits Method Annual Ending Year Depreciation Book Value 3 4 5. 6. 7.

Straight-Line, Declining-Balance, Sum-Of-The-Years'-Digits, and MACRS Methods A machine is purchased January 1 at a cost of $59,000. It is expected to serve for eight years and have a salvage value of $3,000. Required: 1. Prepare a schedule showing depreciation for each of the eight years and the book value at the end of each year using the following methods: a. Straight-line Straight-Line Method Annual Ending Year Depreciation Book Value 1 2 3 4 6. 8 b. Double-declining-balance (round to two decimal places) Double-Declining-Balance Method Annual Ending Year Depreciation Book Value 2 3 4 6. 8 c. Sum-of-the-years'-digits (round to two decimal places) Sum-Of-The-Years'-Digits Method Annual Ending Year Depreciation Book Value 3 4 5. 6. 7.

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Description: Straight-Line, Declining-Balance, Sum-Of-The-Years'-Digits, and MACRS MethodsA machine is purchased January 1 at a cost of $59,000. It is expected to serve for eightyears and have a salvage value of $3,000.Required:1. Prepare a schedule showing depr

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Comparing Theee Depreciation Methods Dexter Industries purchased packaging equipment on January 8 for $233,400. The equipment was expected to have a useful ife of three years, or 6,300 operating hours, and a residual value of $19,200. The equipment was used for 2,520 hours during Year 1, 1,953 hours in Year 2, and 1,827 hours in Year 3. Required: 1. Determine the amount of depreciation expense for the three years ending December 31, Year 1, Year 2, Vear 3, by (a) the straight-ine method, (b) the unite-of- activity method, and (e) the double-decining-balance method, Also determine the total depreciation expense for the three years by each method. Note: For all methods, round the answer for each year to the nearest whole dollar. Depreciation Expense Straight-Line Nethod Units-of-Activity Method Double-Declining-Balance Method Year Year 1 Year 2 Year 3 Total 2. What method yields the highest depreciation expense for Year 17 3. What method ylelds the most depreciation over the three-year…
Becker Office Service purchased a new computer system on January 1, Year 1, for $33,400. It is expected to have a five-year useful life and a $3,700 salvage value. Becker Office Service expects to use the computer system more extensively in the early years of its life. Required a. Calculate the depreciation expense for each of the five years, assuming the use of straight-line depreciation. b. Calculate the depreciation expense for each of the five years, assuming the use of double-declining-balance depreciation. d. Assume that Becker Office Service sold the computer system at the end of the fourth year for $20,500. Compute the amount of gain or loss using each depreciation method. Complete this question by entering your answers in the tabs below. Required A Required B Required D Calculate the depreciation expense for each of the five years, assuming the use of double-declining-balance depreciation. Note: Enter all amounts as positive values. Do not round intermediate calculations.…
Requirement 1. For each depreciation method, prepare a depreciation schedule showing asset cost, depreciation expense, accumulated depreciation, and asset book value for each year of the asset's life. For the units of production method, round depreciation per unit to three decimal places. Before completing the straight-line depreciation schedule, calculate the straight-line depreciation rate. One year Useful life (SL) Depreciation rate - X 1 More Info - X Requirements Complete the Straight-Line Depreciation Schedule. Begin by filling out the schedule through 2019, and then complete the schedule by entering the amounts through 2022. On January 4, 2018, Bailey Enterprises, Inc., paid $205,600 for equipment used in manufacturing automotive supplies. In addition to the basic purchase price, the company paid $1,000 for transportation charges, $100 for insurance for the equipment while in transit, $10,500 sales tax, and $2,800 for a special which to place the equipment in the plant.…
Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] On April 1, Cyclone Company purchases a trencher for $288,000. The machine is expected to last five years and have a salvage value of $44,000. Exercise 8-12 (Algo) Double-declining-balance, partial-year depreciation LO C2 Compute depreciation expense at December 31 for both the first year and second year assuming the company uses the double- declining-balance method. (Enter all amounts as positive values.) Annual Period Beginning of Period Book Value Year 1 Year 2 Depreciation for the Period Depreciation Partial Depreciation Rate Year Expense End of Period Accumulated Depreciation Book Value
Depreciation by two methods A storage tank acquired at the beginning of the fiscal year at a cost of $104,400 has an estimated residual value of $15,000 and an estimated useful life of 10 years. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. Xx Open spreadsheet a. Determine the amount of annual depreciation by the straight-line method. Round your answer to the nearest dollar. b. Determine the amount of depreciation for the first and second years computed by the double-declining-balance method. Do not round the double-declining balance rate. Round your answers to the nearest dollar. Year 1 Year 2 Depreciation
Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] On April 1, Cyclone Company purchases a trencher for $288,000. The machine is expected to last five years and have a salvage value of $44,000. Exercise 8-11 (Algo) Straight-line, partial-year depreciation LO C2 Compute depreciation expense at December 31 for both the first year and second year assuming the company uses the straight-line method. Choose Numerator: Year First year Second year Annual Depreciation X Choose Denominator: Fraction of Year || = = = = Annual Depreciation Annual depreciation Depreciation Expense
Required information Use the following information for the Exercises below. [The following information applies to the questions displayed below.] On April 1, Cyclone Co. purchases a trencher for $280,000. The machine is expected to last five years and have a salvage value of $40,000. Exercise 8-12 Double-declining-balance, partial-year depreciation LO C2 Compute depreciation expense at December 31 for both the first year and second year assuming the company uses the double- declining-balance method. (Enter all amounts as positive values.) Depreciation for the Period End of Period. Beginning of Period Book Value Depreciation Rate Depreciation Expense Accumulated Annual Period Partial Year Book Value Depreciation Yoor 1
Straight-Line, Declining-Balance, and Sum-of-the-Years'-Digits Methods A light truck is purchased on January 1 at a cost of $14,000. It is expected to serve for eight years and have a salvage value of $6,000. Calculate the depreciation expense for the first and third years of the truck's life using the following methods. Round your answers to the nearest cent. 1. Straight-line 2. Double-declining-balance 3. Sum-of-the-years'-digits Depreciation Expense Year 1 1,000 Year 3 E
A storage tank acquired at the beginning of the fiscal year at a cost of $586,000 has an estimated residual value of $52,000 and an estimated useful life of 10 years. Determine the following: a. the amount of annual depreciation by the straight-line method and b. the amount of depreciation for the first, second, and third years computed by the double-declining-balance method. c. A diesel-powered tractor with a cost of $216,000 and estimated residual value of $39,000 is expected to have a useful operating life of 45,000 hours. During February, the generator was operated 860 hours. Determine the depreciation for the month. d. Prepare the journal entry to record the depreciation under c. above.
Units-of-Production Method A light truck is purchased on January 1 at a cost of $35,000. It is expected to serve for eight years and have a salvage value of $5,000. It is expected to be used for 100,000 miles over its eight-year useful life. Using the units-of-production method, calculate the depreciation expense for the first and third years of use if the truck is driven 20,000 miles in year 1 and 24,000 miles in year 3. Depreciation Expense Year 1 Year 3
Straight-Line, Declining-Balance, Sum-Of-The-Years'-Digits, and MACRS Methods A machine is purchased January 1 at a cost of $55,000. It is expected to serve for eight years and have a salvage value of $2,000. Required: 1. Prepare a schedule showing depreciation for each of the eight years and the book value at the end of each year using the following methods: a. Straight-line Straight-Line Method Ending Year Depreciation Book Value Annual 1 $1 3 4 7 8. b. Double-declining-balance (round to two decimal places) Double-Declining-Balance Method