1. Cutter Enterprises purchased equipment for $72,000 on January 1, 2018. The equipment is expected to have a five-year life and a residual value of $6,000. Using the sum-of-the-years'-digits method, depreciation for 2019 and book value at December 31, 2019, would be:

Multiple Choice

• $19,200 and $30,800 respectively.

• $19,200 and $28,800 respectively.

• $17,600 and $26,400 respectively.

• $17,600 and $32,400 respectively.

  2. Cutter Enterprises purchased equipment for $66,000 on January 1, 2018. The equipment is expected to have a five-year life and a residual value of $7,500. Using the sum-of-the-years'-digits method, depreciation for 2018 and book value at December 31, 2018, would be: (Do not round depreciation rate per year)

  Multiple Choice

• $22,000 and $36,500 respectively.

• $19,500 and $46,500 respectively.

• $22,000 and $44,000 respectively.

• $19,500 and $39,000 respectively.