Question
Comparing Three Depreciation Methods Dexter Industries purchased packaging equipment on January 8 for $329,600. The equipment was expected to have a useful life of three
Comparing Three Depreciation Methods
Dexter Industries purchased packaging equipment on January 8 for $329,600. The equipment was expected to have a useful life of three years, or 7,200 operating hours, and a residual value of $27,200. The equipment was used for 2,880 hours during Year 1, 2,232 hours in Year 2, and 2,088 hours in Year 3.
Required:
1. Determine the amount of depreciation expense for the three years ending December 31, Year 1, Year 2, Year 3, by (a) the straight-line method, (b) the units-of-activity method, and (c) the double-declining-balance method. Also determine the total depreciation expense for the three years by each method.
Note: For all methods, round the answer for each year to the nearest whole dollar.
Comparing Three Depreciation Methods Dexter Industries purchased packaging equipment on January 8 for $329,600. The equipment was expected to have a useful ufe of three years, or 7,200 operating hou and a residual value of $27,200. The equipment was used for 2,880 hours during Year 1, 2,232 hours in Year 2, and 2,068 hours in Year 2. Required: 1. Determine the amount of depreclation expense for the three years ending December 31 , Year 1 , Year 2 , Year 3 , by (a) the straight-line methad, (b) the umita-ofactivity methiod, and (c) the double-declining-balance method. Aso determine the total depreciation expense for the three years by each method. Note: For alt methods, round the answer for each year to the nearest whole dollar: 2. What method yields the highest depredation expense for Year 17 3. What method vields the most depreciation over the three-year wfe of the equipment
Comparing Three Depreciation Methods
Dexter Industries purchased packaging equipment on January 8 for $329,600. The equipment was expected to have a useful life of three years, or 7,200 operating hours, and a residual value of $27,200. The equipment was used for 2,880 hours during Year 1, 2,232 hours in Year 2, and 2,088 hours in Year 3.
Required:
1. Determine the amount of depreciation expense for the three years ending December 31, Year 1, Year 2, Year 3, by (a) the straight-line method, (b) the units-of-activity method, and (c) the double-declining-balance method. Also determine the total depreciation expense for the three years by each method.
Note: For all methods, round the answer for each year to the nearest whole dollar.
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