Problem 2

Red Brick Company purchased a front-end loader and tractor for $42,000 on April 1, 2014. The tractor has an estimated useful life of six years or 25,800 hours and a residual value of $2,000. Listed in the chart below is the number of hours the tractor and front-end loader were used during 2014 through 2020.

Year# of hours used

20143,990

20154,270

20163,990

20174,150

20184,245

20194,075

20201,080

a) Calculate depreciation using the straight-line method for 2014through 2020.

b) Calculate depreciation using units of production method for 2014 through 2020.

c) Calculate depreciation using declining balance method for 2014 through 2020.