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A machine costing $215,600 with a four-year life and an estimated $18,000 salvage value is installed in Luther Company's factory on January 1. The
A machine costing $215,600 with a four-year life and an estimated $18,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 494,000 units of product during its life. It actually produces the following units: 122,000 in Year 1, 123,000 in Year 2, 121,100 in Year 3, 137,900 in Year 4. The total number of units produced by the end of Year 4 exceeds the original estimate-this difference was not predicted. Note: The machine cannot be depreciated below its estimated salvage value. Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. Note: Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar. Complete this question by entering your answers in the tabs below. Straight Line Units of Production Double declining balance Compute depreciation for each year (and total depreciation of all years combined) for the machine under the Units of production. Year Units Depreciable Units Units of Production Depreciation per unit Depreciation Expense Year 1 122,000 122,000 $ 0.40 Year 2 123,000 123,000 $ 0.40 Year 3 121,100 121,100 $ 0.40 Year 4 137,900 127,900 $ 0.40 Total 494,000 $ < Straight Line Double declining balance >
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