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On January 1, 2017 ABC Company purchased equipment costing $10,000,000, and its residual value is $100,000....

On January 1, 2017 ABC Company purchased equipment costing $10,000,000, and its residual value is $100,000. The estimated useful life of the asset is four years. Further, management expects to use the equipment for 9,900 hours over its life. In 2017 the equipment was used for 1,000 hours, and in 2018 the equipment was used for 5,000 hours.

Compute depreciation for calendar years 2017 AND 2018 under the following method

Sum-of-the-year’s digits

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Depreciation fro year 2017 and 2018 as per Sum-of-the-year’s digits method

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