Question: An asset has a useful life of 3 years. cost of the asset is $2000. Residual value is $500.

the asset can be used for a total of 1500 hours. it is used for 650 hours in the first year of operations and for 600 hours in the second year.

Depreciation expense for the three years will be as follows:

Calculate annual depreciation for the first and second year of the operations using (1) straight-line method (2) Units of production method and (3) reducing balance using 30%.