On 1/1/18 Meganco purchased a new lathe for $400,000 installed.

The physical life of the lathe is 10 years with a salvage value of $20,000 at the end of that time period. The lathe was purchase for a contract that will provide revenue to Meganco for 5 years. The lathe will be sold at the end of the contract for $50,000.

Required: Make the required journal entry on 12/31/18 and

12/31/19 assuming that the lathe is depreciated

using 200% double declining balance.