on jan 1 2016 te allgay corp purchased machinery for 115,000 the estimated servi

Question

on jan 1 2016 te allgay corp purchased machinery for 115,000 the estimated service life of the machinary is 10 years and the estimated residul value of 5,000 the machine is expected to produce 220,000 units during its life

required calculate depreciatin for 2016 and 2017 using each of the following methods. partial-year depreciation is calculated based on the number of months the asset is in service. round all computations to the nearest dollar

1.straght line

2. sum of the years digits

3. double declining balance,

4. one hundred and fifty percent decling balance

5. units of production (units produced in 2016, 10,000 units produced in 2017 25,000)

Explanation / Answer

Annual depreciation for 2016 and 2017:

Depreciation method 2016 2017 1. Straight line $ 11,000 $ 11,000 2. Sum of the years' digits $ 20,000 $ 18,000 3. Double declining balance $ 23,000 $ 18,400 4. 150% declining balance $ 17,250 $ 14,662.5 5. Units of production $ 5,000 $ 12,500

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