Disposing of depreciable asset at a gain or a loss

On July 1^st of Year 1, Superior Snow Shovels purchased a new piece of equipment for $100,000. The equipment had a useful life of 8 years and an expected residual value of $20,000. The company expected that the machine would operate for 4,000 hours in those 8 years.

The company has a fiscal year end of December 31.

On October 1^st of Year 3, the Company sells the equipment for $70,000.

The machine operated for the following hours:

Year 1 100

Year 2 250

Year 3 200

Required:

Fill in the table included as part of the Disposal of depreciable asset template for the following methods:

a) Straight line

b) Units of production

c) Double declining balance