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Use the following to answer the question(s) below. On January 1, 2018, Morrow Inc. purchased a spooler at a cost of $90,000. The equipment
Use the following to answer the question(s) below. On January 1, 2018, Morrow Inc. purchased a spooler at a cost of $90,000. The equipment is expected to last three years and have a residual value of $6,000. During its eight-year life, the equipment is expected to produce 200,000 units of product. In 2018, 2019 and 2020, 150,000 and 60,000 and 10,000 units respectively were produced. 1) Required: Compute depreciation for 2018, 2019 and 2020, assuming the double-declining-balance method is used. 2) Required: Compute depreciation for 2018, 2019 and 2020, assuming the units-of-production is used.
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