Question

1. A three-year-old machine has a cost of $17,200, an estimated residual value of $1,200, and an estimated useful life of 32,000 machine hours. The company uses units-of-production depreciation and ran the machine 3,400 hours in year 1; 7,750 hours in year 2; and 7,900 hours in year 3. Calculate the net book value at the end of the third year.

2. A three-year-old machine has a cost of $63,000, an estimated residual value of $5,800, and an estimated useful life of five years. The company uses double-declining-balance depreciation. Calculate the net book value at the end of each year.

Please show your work

Answer #1

1) | Depreciation rate = (17200-1200)/32000 | ||||||

0.5 | per machine hour | ||||||

Accumulated depreciation = (3,400+7,750+7900)*$.5 | |||||||

9525 | |||||||

Net book value at the end of third year | |||||||

orginal cost | 17200 | ||||||

less:Accumulate depreciation | -9,525 | ||||||

Net book value at the end of third year | 7675 | answer | |||||

2) | Depreciation rate = 1/5*2= | 0.4 | or 40% | ||||

cost | Dep | Net value | |||||

year 1 | 63,000 | 25200 | 37800 | ||||

year 2 | 37,800 | 15120 | 22680 | ||||

year 3 | 22,680 | 9072 | 13,608 | ||||

Net book value at year end $13,608 | anser | ||||||

A machine that cost $400,000 has an estimated residual value of
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1. Calculate the machine's depreciable cost.
2. Calculate the machine's depreciation expense for each
year.
3. Calculate the machine's accumulated depreciation and book
value at the end of each year.

A machine that cost $400,000 has an estimated residual value of
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uses straight-line depreciation. Required:
1. Calculate the machine's depreciable cost.
2. Calculate the amount of depreciation expense that will be
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3. Calculate the machine's accumulated depreciation and book
value at the end of each year.

A machine with a cost of $58,900 has an estimated residual value
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A machine with a cost of $64,100.00 has an estimated residual
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((((((((((((((Instructions))))))))))))))))
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