Nature Power Company uses the composite method and straight-line depreciation for its power plant equipment. Its Apple River plant, which began generating electricity January 1, 2016 had the following equipment:

Equipment Life (years) Estimates Cost Residual Value

Turbines 25 $4,500,000 $500,000

Steam pipes 15 3,000.000 300,000

Furnace 20 6,000,000 0

1. Compute the composite depreciation rate.

2. Compute the average service life.

3. Compute 2016 depreciation.