A. Assume you own the machinery above. Calculate the annual depreciation expense using the straight-line method. Assume all machinery is bought at the first of the year.

Machine Cost Salvage Value Useful Life

1) Tractor A 50,000 20,000 5

2) Tractor B 60,000 0 7

B. Calculate the double-declining annual depreciate expense for each tractor.

Calculate years 1 through 7 for both A and B.