Problem I

Barrett Corporation bought equipment on January 1, 2019 for $64,000. At the time, its estimated life was 5 years/200,000 hours and its estimated scrap value was $4,000.

In 2019 the equipment was employed for 35,000 hours.

Required:

Calculate 2019 depreciation expense under:

A) Straight-line depreciation

B) Units of production method

C) Double Declining Balance

Problem II

On May 1, 2020 Harris Corporation purchased three machines for a total of $160,000. If he purchased them separately Machine 1 would have cost $50,000; Machine 2 would have cost $80,000; and Machine 3 would have cost $70,000.

Required:

Prepare the journal entry Harris should make on May 1, 2020.