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Nickle Company purchased three identical assets for $17,000 on January 2, 2016. Each asset has an expected residual value of $1,000. The depreciation expense for
Nickle Company purchased three identical assets for $17,000 on January 2, 2016. Each asset has an expected residual value of $1,000. The depreciation expense for 2016 and 2017 is shown below for three assets:
YearAsset AAsset BAsset C2016$ 4,000$ 6,400$6,37520174,0004,8003,984Required:
- Which depreciation method is the company using in each example?
- Asset A:Straight-line
- Asset B:Sum-of-the-years'-digits
- Asset C:150%-declining balance
- Compute the depreciation expense for 2018 under each method. If required, round to the nearest dollar.
- Asset A:$Asset B:$Asset C:$Compute the depreciation expense for 2019 under each method. If required, round to the nearest dollar.
- Asset A:$Asset B:$Asset C:$
Sorter Company purchased equipment for $200,000 on January 2, 2016. The equipment has an estimated service life of 8 years and an estimated residual value of $20,000.
Required:
Compute the depreciation expense for 2016 under each of the following methods:
- straight-line: $
- sum-of-the-years'-digits: $
- double-declining-balance: $
- Depreciation causes the book value of the assets to
- each period. When an accelerated depreciation method is used, the rate of return
- each period.
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