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Modern Products Company purchased new packaging equipment for $100,000 on January 1, 20X1. The equipment is expected to be used for 5 years, or 40,000
Modern Products Company purchased new packaging equipment for $100,000 on January 1, 20X1. The equipment is expected to be used for 5 years, or 40,000 operating hours. It has an estimated salvage value of $10,000. The equipment was used for 3,800 hours in 20X1, 4,300 hours in 20X2, and 3,750 hours in 20X3.
Compute annual depreciation expense for the first three years, using the straight-line method, the double-declining balance method, and the units of output method.
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