Answered step by step
Verified Expert Solution
Question
1 Approved Answer
On October 1, 2021, the Allegheny Corporation purchased machinery for $148,000. The estimated service life of the machinery is 10 years and the estimated residual
On October 1, 2021, the Allegheny Corporation purchased machinery for $148,000. The estimated service life of the machinery is 10 years and the estimated residual value is $5,000. The machine is expected to produce 260,000 units during its life. Required: Calculate depreciation for 2021 and 2022 using each of the following methods. Partial-year depreciation is calculated based on the number of months the asset is in service. (Do not round intermediate calculations.)
1. Straight line. Straight-Line Depreciation Choose Numerator: Choose Denominator: Annual Depreciation Cost minus Salvage Estimated Useful Life (years) = Annual Depreciation Annual Depreciation Depreciation expense Year Fraction of Year 2021 3/12 2022 12/12 2. Double-declining balance. Depreciation for the Period End of Period Beginning of Period Book Depreciation Rate (%) Depreciation Expense Fraction of Accumulated Annual Period Book Value Year Depreciation Value 2021 20% 0 2022 20% 0 3. Units of production (units produced in 2021, 13,000; units produced in 2022, 28,000). to 2 decimal places.) Select formula for Units of Production Depreciation: Calculate 2021 depreciation expense: Depreciation per unit rate Units produced in 2021 Depreciation in 2021 Calculate 2022 depreciation expense: Depreciation per unit rate Units produced in 2022 Depreciation in 2022Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started