Basic information relating to a new machine purchased by Deloise Company is presented in E9-5. Instructions Using
Question:
Instructions
Using the facts presented in E9-5, compute depreciation using the following methods in the year indicated.
(a) Declining-balance using double the straight-line rate for 2012 and 2013.
(b) Units-of-activity for 2012, assuming machine usage was 3,900 hours. (Round depreciation per unit to the nearest cent.)
Step by Step Answer:
a Decliningbalance method 2012 depreciation 90000 X 2...View the full answer
Accounting Tools For Business Decision Making
ISBN: 9780470377857
3rd Edition
Authors: Paul D. Kimmel
Related Video
In accounting terms, depreciation is defined as the reduction of the recorded cost of a fixed asset in a systematic manner until the value of the asset becomes zero or negligible. An example of fixed assets are buildings, furniture, office equipment, machinery, etc. The land is the only exception that cannot be depreciated as the value of land appreciates with time. Depreciation allows a portion of the cost of a fixed asset to be the revenue generated by the fixed asset. This is mandatory under the matching principle as revenues are recorded with their associated expenses in the accounting period when the asset is in use. This helps in getting a complete picture of the revenue
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