Question
Becker Office Service purchased a new computer system in 2016 for $39,500. It is expected to have a five-year useful life and a $2,700 salvage
Becker Office Service purchased a new computer system in 2016 for $39,500. It is expected to have a five-year useful life and a $2,700 salvage value. The company expects to use the system more extensively in the early years of its life.
a.) Calculate the depreciation expense for each of the five years, assuming the use of straight-line depreciation.
b.) Calculate the depreciation expense for each of the five years, assuming the use of double-declining- balance depreciation.(Do not round intermediate calculations. Round your final answers to the nearest dollar amount.)
c.)Assume that Becker Office Service sold the computer system at the end of the third year for $20,000. Compute the amount of gain or loss using each depreciation method.(Round your answers to the nearest dollar amount.)
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