9) Big Valley Ltd. purchased machinery on January 2, 2019, at a total cost of $85,000. The machinery estimated useful life is 8 years or 60,000 hours, and its residual value is $5,000. During 2019 and 2 machinery was used 7,000 and 7,500 hours, respectively. Compute depreciation under straight-line, units-of-production, and double-diminishing-balance meth 2019 and 2020. 2019 2020 Straight-line depreciation Units-of-production depreciation Double-diminishing-balance depreciation L.LI

9) Big Valley Ltd. purchased machinery on January 2, 2019, at a total cost of $85,000. The machinery estimated useful life is 8 years or 60,000 hours, and its residual value is $5,000. During 2019 and 2 machinery was used 7,000 and 7,500 hours, respectively. Compute depreciation under straight-line, units-of-production, and double-diminishing-balance meth 2019 and 2020. 2019 2020 Straight-line depreciation Units-of-production depreciation Double-diminishing-balance depreciation L.LI

Name: 9) Big Valley Ltd. purchased machinery on January 2, 2019, at a total
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Description: 9) Big Valley Ltd. purchased machinery on January 2, 2019, at a total cost of $85,000. The machinery'sestimated useful life is 8 years or 60,000 hours, and its residual value is $5,000. During 2019 and 2020, themachinery was used 7,000 and 7,500 hou

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Depreciation Methods

The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.

Depreciation Accounting

In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.

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Question

9) Big Valley Ltd. purchased machinery on January 2, 2019, at a total cost of $85,000. The machinery's
estimated useful life is 8 years or 60,000 hours, and its residual value is $5,000. During 2019 and 2020, the
machinery was used 7,000 and 7,500 hours, respectively.
Compute depreciation under straight-lline, units-of-production, and double-diminishing-balance methods for
2019 and 2020.
2019
2020
Straight-line depreciation
Units-of-production depreciation
Double-diminishing-balance
depreclation
L.I.

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