Question
On January 2, 2015, Alvarez Company purchased an electroplating machine to help manufacture a part for one of its key products. The machine cost $260,700
On January 2, 2015, Alvarez Company purchased an electroplating machine to help manufacture a part for one of its key products. The machine cost $260,700 and was estimated to have a useful life of six years or 700,000 cuttings, after which it could be sold for $26,400. Required
a. Calculate each years depreciation expense for the period 2015-2020 under each of the following. Units-of-production.method (Assume annual production in platings of 140,000; 180,000; 100,000; 110,000; 80,000; and 90,000.)
b. Assume that the machine was purchased on September 1, 2015. Calculate each years depreciation expense for the period 2015-2020 under each of the following depreciation methods: 1. Straight-line. 2. Double-declining balance.
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