Question
Depreciation Methods Gruman Company purchased a machine for $198,000 on January 2, 2016. It made the following estimates: Service life 5 years or 10,000 hours
Depreciation Methods
Gruman Company purchased a machine for $198,000 on January 2, 2016. It made the following estimates:
| Service life | 5 years or 10,000 hours |
| Production | 180,000 units |
| Residual value | $ 18,000 |
In 2016, Gruman uses the machine for 2,000 hours and produces 50,000 units. In 2017, Gruman uses the machine for 1,200 hours and produces 30,000 units. If required, round your final answers to the nearest dollar.
Required:
- Compute the depreciation for 2016 and 2017 under each of the following method
- Activity method based on hours worked
| 2016 | $ |
| 2017 | $ |
- Activity method based on units of output
| 2016 | $ |
| 2017 | $ |
- Activity method based on hours worked
| 2016 | $ |
| 2017 | $ |
- Activity method based on units of output
| 2016 | $ |
| 2017 | $ |
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Financial and managerial accounting
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
1st edition
111800423X, 9781118233443, 1118016114, 9781118004234, 1118233441, 978-1118016114
