Scenario: Cost Useful Life (Years) = Useful Life (Hours)= Salvage/Residual Value= 160,000 1) Determine Depreciable Cost: 5 140,000 10,000 2) Method 1: Straight Line a) Calculate the SL annual rate: b) Calculate the SL annual depreciation expense: c) Calculate depreciation expense, accumulated depreciation and book value for the life of the asset. Depreciation Annual Depr Accum. Depreciable Cost Rate Exp Depr. Book Value Year 2018 2019 2020 2021 2022 =Salvage Value Depr. Cost 3) Method 2: Units of Activity a) Calculate the Units of Activity rate: b) Calculate depreciation expense, accumulated depreciation and book value for the life of the asset. Units of Depreciation Annual Depr Accum. Year Activity Rate 2018 30,000 2019 20,000 2020 25,000 2021 40,000 2022 25,000 Exp Depr. Book Value = Salvage Value 140,000 = Depr. Cost 4) Method 3: One and one-half (1.5) Declining Balance SL Rate= DB Rate= a) Calculate depreciation expense, accumulated depreciation and book value for the life of the asset. Depreciation Annual Depri Accum. Book Value Year Beg. Of Year Rate 2018 2019 2020 2021 2022 Exp Depr. Book Value Salvage Value PLUG = Depr. Cost