Production Inc. has a year end date of June 30 and produces small electronic music parts. The company records depreciation to the nearest whole month in the year a capital assets is purchased On March 20, 2016, they purchased and put into use a new production machine by spending the following amounts:

Invoice price of the machinery (purchase terms 1/10, n30) - paid March 25

$190,000

Freight to have the machinery delivered to Production's facility

5,000

Duty upon shipment of the machinery to Production's facility

4,900

Damage as a result of an employee dropping his Starbuck's latte

into the motor of the new machinery

3,000

Cost of mounting the machinery on a permanent platform in the warehouse

2,000

The management of Production Inc. has made the following assumptions: Years the machine is expected to be used in the business

5 years

Number of products the machinery is expected to produce

1,000, 000

Expected salvage value at the end of 5 years

$50,000

REQUIRED:

Compute depreciation under each of the following three methods for the first 5 year ends of Production Inc. following the purchase of the machine.

Assume for the units of output method that the number of products produced in each of the following business years are as follows:

2016 80,000 units

2017 250,000 units

2018 245,000 units

2019 205,000 units

2020 225,000 units

Method-Units of Output Depreciation expense Acc. Depreciation Net Book Value, End

2016

2017

2018

2019

2020

Method - Double Declining Balance Net Book Value, Beginning of year Depreciation Expense Accumulated Net Book Value, End of year

Depreciation

2016

2017

2018

2019

2020

Method - Straight Llne Depreciation expense Acc. Depreciation Net Book Value, End

2016

2017

2018

2019

2020