On June 1, Aggie Company purchased equipment for $ 50,000. The equipment has a 7yr life with a residual value of $5,000. Aggie uses units-of-production method depreciation and the equipment is expected to yield 9,000 operating hours.

(a) Calculate the depreciation expense per hour of operation.

(b) The bulldozer is operated 1,000 hours in the first year, 200 hours in the second year, and 1,400 hours in the third year of operations. Journalize the depreciation expense for each year.

Date	Account Title	Debit	Credit
Year 1
Year 1
Year 3