Question
On January 1, 2018, a machine was purchased for $117,500. The machine has an estimated salvage value of $10,400 and an estimated useful life of
On January 1, 2018, a machine was purchased for $117,500. The machine has an estimated salvage value of $10,400 and an estimated useful life of 5 years. The machine can operate for 119,000 hours before it needs to be replaced. The company closed its books on December 31 and operates the machine as follows: 2018, 23,800 hrs; 2019, 29,750 hrs; 2020, 17,850 hrs; 2021, 35,700 hrs; and 2022, 11,900 hrs.
(a)
Compute the annual depreciation charges over the machines life assuming a December 31 year-end for each of the following depreciation methods. (Round answers to 0 decimal places, e.g. 45,892.)
1. | Straight-line Method | $ | ||
2. | Activity Method | |||
Year | ||||
2018 | $ | |||
2019 | $ | |||
2020 | $ | |||
2021 | $ | |||
2022 | $ | |||
3. | Sum-of-the-Years'-Digits Method | |||
Year | ||||
2018 | $ | |||
2019 | $ | |||
2020 | $ | |||
2021 | $ | |||
2022 | $ | |||
4. | Double-Declining-Balance Method | |||
Year | ||||
2018 | $ | |||
2019 | $ | |||
2020 | $ | |||
2021 | $ | |||
2022 | $ |
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