On January 1, 2016, Hobart Mfg. Co. purchased a drill press at a cost of $30,500. The drill press is expected to last 10 years and has a residual value of $5,500. During its 10-year life, the equipment is expected to produce 500,000 units of product. In 2016 and 2017, 22,500 and 79,000 units, respectively, were produced.

Required:

Compute depreciation for 2016 and 2017 and the book value of the drill press at December 31, 2016 and 2017, assuming the straight-line method is used.

2016 2017

Depreciation:

Book Values: