Jackson Company purchased a milling machine on January |, 2000 for $60,000. The ma- chine had an expected life of 10 years and a residual value of $2,000.

Required: (1) Compute the depreciation for 2000 and 2001 under each of the following methods:

(a) straight line and

(b) double declining balance. (2) Show how the company would report the book value of the machine on its December 31, 2001 balance sheet under each method.

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