Question

On May 1, 2016, Lion, Inc. purchased equipment for $110,000 cash. Lion estimates that the equipment...

On May 1, 2016, Lion, Inc. purchased equipment for $110,000 cash. Lion estimates that the equipment will have a salvage value of $8,000 and a useful life of 7 years. Lion is on a calendar year basis ending December 31.

Required:

Compute the depreciation expense under each of the following methods for 2016 and 2017.

  1. Straight line method for 2016 and 2017
  2. Sum of the years digits method for 2016 and 2017
  3. Double Declining balance method for 2016 and 2017
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