Comparing Three Depriciation Methods

Comparing Three Depreciation Methods Dexter Industries purchased pockaging equipment on January 8 for $973,200. The equipment was expected to have a usefut fife of four years, or 9,600 operating hours, and a residual volue of $80,400. The equipment was used for 3,360 hours during Year 1, 2,016 hours in Year 2,2,688 hours in Year 3, and 1,536 hours in Year 4. Required: 1. Determine the amount of depreciation expense for the four years ending December 31 by (a) the straight-ine muthod, (b) the units-ar activity intinod, and (c) the dobble-deciining-balance method. Also determine the total depreciation expense for the four years by each method, Round the answer for each year to the nearest whole dollar. 2. What method vields the hyghest deprecistion experise for Year 17 3. What method yields the most deprocstion aver the fouryear bfe of the equipment? 2. What method yields the highest depreciation expense for Year 1 ? lepreciation over the four-year life of the equipment? plue equals depreciable cost. Sum the yearly depreciation to de Annual units-of-production depreciation allocates the cost of the asset equally over the unit The double-declining rate is two times the straight-line rate. Book value is the asset cost m balance in the accumulated depreciation account is zero. 3. What method yields the most depreciation over the four-year life of the equipment? Vive equats depreciable cost. Sum the yearly depreciation fo determine total depreciation. balance in the accurnulated deprecation account is zero. equally over the period of use, while doublo deciling methed is on acceletsted guethad