Nella Corporation, which computes depreciation to the nearest whole month, placed a new piece of equipment in operation on July 1, Year 1. It was expected to produce 400,000 units of product in its estimated useful life of 8 years. Total cost was $300,000; salvage value was estimated to be $30,000. Nella employs a calendar year for financial reporting purposes. Actual production for the past 3 years was as follows:

Year 1 -- 34,000 units

Year 2 -- 62,500 units

Year 3 -- 58,400 units

If Nella uses the double-declining-balance method of depreciation, the amount of depreciation computed (rounded to the nearest dollar) for this equipment for financial reporting purposes in Year 3 would be

A. $49,219 

B. $44,297 

C. $42,188 

D. $75,000 

 

Falkland computes depreciation on the straight-line method. Based upon the information presented, the composite life of these assets (in years) should be

A. 13.3 

B. 16.0 

C. 17.6 

D. 20.02

For its first year of operations, Falkland Co. decided to use the Estimated Estimated Total Cost Salvage Value Life in composite method of depreciation and prepared the schedule of machinery owned presented in the opposite Years Machine X $550,000 $50,000 200,000 20,000 40,000 20 Machine Y 15 column. Machine Z