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On January 1, 2018, a machine was purchased for $97,500. The machine has an estimated salvage value of $6,480 and an estimated useful life of
On January 1, 2018, a machine was purchased for $97,500. The machine has an estimated salvage value of $6,480 and an estimated useful life of 5 years. The machine can operate for 111,000 hours before it needs to be replaced. The company closed its books on December 31 and operates the machine as follows: 2018, 22,200 hrs; 2019,27,750 hrs; 2020, 16,650 hrs; 2021, 33,300 hrs; and 2022, 11,100 hrs. (a) Your answer is correct. Compute the annual depreciation charges over the machine's 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 $ 18204 2. Activity Method Year 2018 $ 18204 2019 $ 22755 2020 $ 13653 2021 $ 27306 2022 $ 9102 3. Sum-of-the-Years'-Digits Method Year 2018 $ 30340 2019 $ 24272 2020 $ 18204 2021 $ 12136 2022 $ 6068 4. Double-Declining-Balance Method Year 2018 $ 39000 2019 $ 23400 2020 $ 14040 2021 $ 8424 2022 $ 6156 Assume a fiscal year-end of September 30. Compute the annual depreciation charges over the asset's life applying each of the following methods. (Round answers to decimal places, eg. 45,892.) Year Straight-line Method Sum-of-the-years-digits method Double-declining-balance method 2018 $ $ $ LA $ 29250 2019 27300 2020 2021 2022 2023
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