A. Straight Line Depreciation - Machinery acquired on 1/1/2010. Cost is $135,000; salvage (residual) value is $12,000, useful life is 5 years. Show your computation to calculate the annual depreciation expense and accumulated depreciation at the end of each year. 1. Complete the following table: Year Annual depreciation expense Accumulated Depreciation Account 2010 2011 2012 Balance @ end of yr 2013 2014 2. What pattern is evident in terms of the amount recognized for annual depreciation expense under the straight-line method? 3. What would change had the equipment been purchased on July 5, 2010, instead of January 1, 2010? B. Units of Activity Machinery acquired on 1/1/2010 for $135,000. Salvage value is $12,000. Useful life is 5 years Total units of activity = 10,000 hours. 1. Will the depreciation rate change from year to year? YES NO 2. Complete the following table for the first four years the equipment is used: Annual Accumulated Depreciation Balance Expense @end of yr Year Hours Used Depreciation rate per Depreciation hr 2010 2,000 2011 2.200 2012 1,900 2013 2,100 2014 1,800 3. What amount must the balance in the accumulated depreciation account for this asset equal at year end 2014.