Problem # 4

On June 1, 2017, Nyland Company purchased for $2,000,000 snow-making equipment having an estimated useful life of 5 years with an estimated salvage value of $800,000. Depreciation is taken for the portion of the year (the number of months) the asset is used during that year. Nylands fiscal year ends on December 31.

Instructions

(a) Record the adjusting entries for depreciation for 2017 and 2018 using the straight-line method.

(b) Record the adjusting entries for depreciation for 2017 and 2018 using the double-declining balance method.