Question
Computing Partial Period Depreciation under Multiple Depreciation Methods To demonstrate the computations involved in several methods of depreciating a fixed asset, the following information is
Computing Partial Period Depreciation under Multiple Depreciation Methods
To demonstrate the computations involved in several methods of depreciating a fixed asset, the following information is provided.
| Cost and residual value | Estimated service life | ||
| Acquisition cost | $20,000 | Years | 5 |
| Residual value | $800 | Service hours | 16,000 |
| Productive output (units) | 38,400 |
Required
Compute the annual depreciation using each of the following methods assuming that the asset was purchased on August 1, 2020.
a. Sum-of-the-years-digits method: Compute the depreciation amount for each year.
| 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Answer | Answer | Answer | Answer | Answer | Answer |
b. Double-declining-balance method: Compute the depreciation amount for each year.
| 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Answer | Answer | Answer | Answer | Answer | Answer |
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Microeconomics Theory And Applications
Authors: Edgar K. Browning, Mark A. Zupan
10th Edition
0470128917, 9780470128916
