Question
On January 2, Roth, Inc. purchased a laser cutting machine to be used in the fabrication of a part for one of its key products.
On January 2, Roth, Inc. purchased a laser cutting machine to be used in the fabrication of a part for one of its key products. The machine cost $130,000, and its estimated useful life was four years or 1,250,000 cuttings, after which it could be sold for $5,000.
Required
a. Calculate each years depreciation expense for the machine's useful life under each of the following depreciation methods (round all answers to the nearest dollar): 1. Straight-line. 2. Double-declining balance. 3. Units-of-production. (Assume annual production in cuttings of 310,000; 460,000; 380,000; and 100,000.)
2. Double-declining balance
Year | Depreciation Expense |
---|---|
Year 1 | 65000 |
Year 2 | 32500
|
Year 3 | 16250
|
Year 4 | 8125
|
Year 5 | ??? |
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