Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Problem 10-2A Depreciation methods LO P1 A machine costing $213,200 with a four-year life and an estimated $18,000 salvage value is installed in Luther Company's
Problem 10-2A Depreciation methods LO P1 A machine costing $213,200 with a four-year life and an estimated $18,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 488,000 units of product during its life. It actually produces the following units: 122,400 in 1st year, 122,500 in 2nd year, 120,600 in 3rd year, 132,500 in 4th year. The total number of units produced by the end of year 4 exceeds the original estimatethis difference was not predicted. (The machine must not be depreciated below its estimated salvage value.) Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. (Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar.) Complete this question by entering your answers in the tabs below. Straight Line Units of Production DDB Compute depreciation for each year and total depreciation of all years combined) for the machine under each Units of production Units of Production Depreciable Depreciation Units per unit Year Depreciation Expense 1 2 3 4 Total $ 0 Problem 10-2A Depreciation methods LO P1 A machine costing $213,200 with a four-year life and an estimated $18,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 488,000 units of product during its life. It actually produces the following units: 122,400 in 1st year, 122,500 in 2nd year, 120,600 in 3rd year, 132,500 in 4th year. The total number of units produced by the end of year 4 exceeds the original estimate-this difference was not predicted. (The machine must not be depreciated below its estimated salvage value.) Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. (Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar.) Complete this question by entering your answers in the tabs below. Straight Line Units of Production DDB Compute depreciation for each year (and total depreciation of all years combined) for the machine under each Double- declining-balance. DDB Depreciation for the Period End of Period Beginning of Depreciation Depreciation Accumulated Year Period Book Rate Expense Depreciation Book Value Value 1 % $ 0 2 % 0 3 % 0 4 % 0 S 0
Step 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