Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Hi, what is the correct answer to the Double-Declining-Balance Method? (with those exact numbers) Comparing Three Depreciation Methods Dexter Industries purchased packaging equipment on January
Hi, what is the correct answer to the Double-Declining-Balance Method? (with those exact numbers)
Comparing Three Depreciation Methods Dexter Industries purchased packaging equipment on January 8 for $198,800. The equipment was expected to have a useful life of three years, or 5,700 operating hours, and a residual value of $16,400. The equipment was used for 2,280 hours during Year 1, 1,767 hours in Year 2, and 1,653 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. Depreciation Expense Year Straight-Line Method Units-of-Activity Method Double-Declining-Balance Method Year 1 60,800 72,960 Year 2 60,800 56,544 Year 3 60,800 52,896 Total 182,400 182,400 $ 182,400 2. What method yields the highest depreciation expense for Year 1? Double-declining-balance method 3. What method yields the most depreciation over the three-year life of the equipment? All three depreciation methodsStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started