A machine costing $209,600 with a four-year life and an estimated $16,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 484,000 units of product during its life. It actually produces the following units: 122,900 in Year 1, 123,100 in Year 2, 120,800 in Year 3, 127.200 in Year 4. The total number of units produced by the end of Year 4 exceeds the original estimate–this difference was not predicted. (The machine cannot be depreciated below its estimated salvage value.) Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. (Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar.) Complete this question by entering your answers in the tabs below. Units of Production Straight Line DDB Compute depreciation for each year (and total depreciation of all years combined) for the machine under the Double- declining-balance. End of Period DDB Depreciation for the Period Beginning of Period Book Value Depreciation Depreciation Rate Accumulated Book Value Year Expense Depreciation % 1 % % 3 Total < Units of Production

A machine costing $209,600 with a four-year life and an estimated $16,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 484,000 units of product during its life. It actually produces the following units: 122,900 in Year 1, 123,100 in Year 2, 120,800 in Year 3, 127.200 in Year 4. The total number of units produced by the end of Year 4 exceeds the original estimate–this difference was not predicted. (The machine cannot be depreciated below its estimated salvage value.) Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. (Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar.) Complete this question by entering your answers in the tabs below. Units of Production Straight Line DDB Compute depreciation for each year (and total depreciation of all years combined) for the machine under the Double- declining-balance. End of Period DDB Depreciation for the Period Beginning of Period Book Value Depreciation Depreciation Rate Accumulated Book Value Year Expense Depreciation % 1 % % 3 Total < Units of Production

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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13. South Bend Hardware Company has a giant paint mixer that cost $31,500. The estimated salvage value of the paint mixer at the end of its useful life of 15 years is estimated to be $1,500. South Bend estimates that the machine can mix 200,000 cans of paint during its lifetime. During the first year of operations, the machine mixed 10,000 cans of paint; during the second it mixed 25,000 cans; during the third it mixed 20,000 cans of paint. 1. Compute depreciation expense for the THIRD year of the paint mixer's life under each of the following methods. Straight-line Units-of production Double-declining balance I 2. Show how the paint mixer would be reported on the balance sheet at the end of the third year assuming that they used the straight-line method.
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A machine costing $215,200 with a four-year life and an estimated $18,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 493,000 units of product during its life. It actually produces the following units: 123,000 in Year 1, 122,500 in Year 2, 119,800 in Year 3, 137,700 in Year 4. The total number of units produced by the end of Year 4 exceeds the original estimate-this difference was not predicted. Note: The machine cannot be depreciated below its estimated salvage value. Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. Note: Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar. Complete this question by entering your answers in the tabs below. Straight Line Units of Production Compute depreciation for each year (and total depreciation of all years combined) for the machine…
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A machine costing $208,800 with a four-year life and an estimated $16,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 482,000 units of product during its life. It actually produces the following units: 122,900 in Year 1, 123,900 in Year 2, 120,100 in Year 3, 125,100 in Year 4. The total number of units produced by the end of Year 4 exceeds the original estimate-this difference was not predicted. Note: The machine cannot be depreciated below its estimated salvage value. Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. Note: Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar. Complete this question by entering your answers in the tabs below. Straight Line Units of Production Double declining balance Compute depreciation for each year (and total depreciation of all years…
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