Part 1:

A storage tank acquired at the beginning of the fiscal year at a cost of $580,000 has an estimated residual value of $155,000 and an estimated useful life of 20 years. Determine the following: a. the amount of annual depreciation by the straight-line method and b. the amount of depreciation for the first, second, and third years computed by the doubledeclining-balance method.

Part 2:

Equipment acquired on January 8 at a cost of $175,000 has an estimated useful life of 15 years, has an estimated residual value of $20,000, and is depreciated by the straight-line method.

a. What was the book value of the equipment at December 31 the end of the fourth year?

b. Assuming the equipment was sold on April 1 of the fifth year for $126,000, journalize the entry to record (1) depreciation for the three months until the sale date and (2) the sale of the equipment.