The following information pertains to a machine purchased by Bakersfield Company on January 1,2005.

The machine produced 14,400 units during 2005 and 17,000 units during 2006.

Required:

Determine the depreciation expense Bakersfield would report for 2005 and 2006 using each of the following methods.

a. Straight-line.

b. Double-declining-balance.

c. Units-of-production.

d. MACRS assuming that the machine is classified as seven-year property.

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Purchase price Delivery cost Installation charge Estimated useful life Estimated units the machine will produce Estimated salvage value $ 63,000 $ 2,000 3,000 $ 8 years 130,000 $ 3,000