1) A machine purchased for $50,000 has a depreciable life of five years. It will have an expected salvage value of $4,500 at the end of the depreciable life.

i. Using the straight-line method, what is the book value at the end of year 3?

ii. If the double-declining balance method is used, what is the depreciation amount for year 2?

iii. Suppose the salvage value at the end of year 4 is estimated to be $10,000 instead of $5,000. If the 200% method is used, what is the depreciation amount for year 3?

2) A trucking company computes depreciation on its vehicles by mileage basis. Suppose a delivery truck has a cost of $20,000, a salvage value of $2,000, and an estimated useful life of 200,000 miles. Determine the depreciation rate per mile.

3) Suppose that you placed a commercial building (warehouse) in service in January. The cost of property is $300,000, which includes the $100,000 value of land. Determine the amount of depreciation that is allowed during the first year of ownership.