On January 1, 2018, Tyson manufacturing corporation purchased a machine for $40,

Question

On January 1, 2018, Tyson manufacturing corporation purchased a machine for $40,400,000. Tyson’s management expects to use the machine for 26,000 hours over the next six years. The estimated residual value of the machine at the end of the six year is $41,000. The machine was used for 4,600 hours in 2018 and 5,600 hours in 2019. What is the depreciation expense for 2018 if the corporation uses the units- of- production method of depreciation? (round any intermediate calculations to two decimals places, and your final answer to the nearest dollar)

A)$8,692,712

B)$7,147,710

C)$13,466,667

D)$7,140,442

The cost of an asset is $1,180,000, and its residual is $180,000. Estimated useful life of the assets is ten years. Calculate depreciation for the first year using the double –declining- balance method of depreciation (do not round any intermediate calculations, and round your final answer to the nearest dollar. )

A)$236,000

B)$100,000

C)$118,000

D)$200,000

Explanation / Answer

1 Depreciation per hour=(40400000-41000)/26000= $1552.27 Depreciation expense for 2018=4600*1552.27= $7140442 2 Depreciation for first year=1180000*20%= $236000

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