A machine is purchased January 1 at a cost of $59,000. It is expected to serve for

Question:

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

Prepare a schedule showing depreciation for each year and the book value at the end of each year using the following methods:

(a) Straight-line

(b) Double-declining-balance (round to two decimal places)

Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...