A machine that cost $1,050,000 has an estimated residual value of $50,000 and an

Question

A machine that cost $1,050,000 has an estimated residual value of $50,000 and an estimated useful life of ten years. The company uses straight-line depreciation. Calculate its book value at the end of year 9. (Do not round intermediate calculations.)

A machine that cost $196,000 has an estimated residual value of $14,000 and an estimated useful life of 14,000 machine hours. The company uses units-of-production depreciation and ran the machine 4,000 hours in year 1, 3,000 hours in year 2, and 4,000 hours in year 3.

A machine that cost $110,000 has an estimated residual value of $11,000 and an estimated useful life of four years. The company uses double-declining-balance depreciation. Calculate its book value at the end of year 3. (Do not round intermediate calculations.)

A machine that cost $1,050,000 has an estimated residual value of $50,000 and an estimated useful life of ten years. The company uses straight-line depreciation. Calculate its book value at the end of year 9. (Do not round intermediate calculations.)

Explanation / Answer

Calculate book value at the end of year 9

Straight line dep = (Original cost-salvage value)/useful life

                         = (1050000-50000)/10

Straight line dep = 100000 per annum

9 year dep = (100000*9) = 900000

Book value at the end of year 9 = (1050000-900000) = 150000

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