A machine with a cost of $63,800 has an estimated residual value of $4,360 and an estimated life of 5 years or 16,664 hours. What is theamount of depreciation for the second full year, using the double-declining-balance method?a. $12,760.00b. $25,520.00c. $15,312.00d. $23,776.00

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Answered: A machine with a cost of $63,800 has an…

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter18: Accounting For Long-term Assets

Section: Chapter Questions

Problem 3CE: A machine costing 350,000 has a salvage value of 15,000 and an estimated life of three years....

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A machine costing 350,000 has a salvage value of 15,000 and an estimated life of three years. Prepare depreciation schedules reporting the depreciation expense, accumulated depreciation, and book value of the machine for each year under the double-declining-balance and sum-of-the-years-digits methods. For the double-declining-balance method, round the depreciation rate to two decimal places.
To test your formulas, assume the machine purchased had an estimated useful life of three years (20,000, 30,000, and 50,000 hours, respectively). Enter the new information in the Data Section of the worksheet. Does your depreciation total 320,000 under all three methods? There are three common errors made by students completing this worksheet. Lets clear up two of them. One, an asset that has a three-year life should have no depreciation claimed in Year 4. This can be corrected using an =IF statement in Year 4. For example, the correct formula in cell C32 is =IF(B32D9,0,(D7D8)/D9) or =IF(B32D9, 0, SLN(D7, D8, D9)). You may wish to edit what you have already entered rather than retype it. Two, as mentioned in requirement 2, the double-declining-balance calculation needs to be modified in the last year of the assets life. Assuming you have already modified the formula for Year 4 (per instructions in step 2), alter the formula for Year 3 also. If you corrected any formulas, test their correctness by trying different estimated useful lives (between 3 and 8) in cell E9. Then reset the Data Section to the original values, save the revised file as DEPREC2, and reprint the worksheet to show the correct formulas. The third common error doesnt need to be corrected in this problem. The general form of the double-declining-balance formula needs to be modified to check the net book value of the asset each year to make sure it does not go below salvage value. =DDB does this automatically, but if you are writing your own formulas, this gets very complicated and is beyond the scope of the problem.
A machine with a cost of $62,300 has an estimated residual value of $4,031 and an estimated life of 5 years or 17,709 hours. What is the amount of depreciation for the second full year, using the double-declining-balance method? a.$23,307.60 b.$12,460.00 c.$14,952.00 d.$24,920.00
A machine with a cost of $67,400 has an estimated residual value of $4,408 and an estimated life of 5 years or 15,993 hours. What is the amount of depreciation for the second full year, using the double-declining-balance method? a. $16,176.00 b. $25,196.80 c. $13,480.00 Od. $26,960.00
A machine with a cost of $66,200.00 has an estimated residual value of $3,201.00 and an estimated life of 5 years or 18,256 hours. What is the amount of depreciation for the second full year, using the double declining-balance method? Select the correct answer. a.) $15,888.00 b.) $26,480.00 c.) $13,240.00 d.) $25,199.60
A machine with a cost of $67,600.00 has an estimated residual value of $3,188.00 and an estimated life of 5 years or 15,868 hours. What is the amount of depreciation for the second full year, using the double declining-balance method? Select the correct answer. $25,764.80 $13,520.00 $16,224.00 $27,040.00
A machine with a cost of $75,000 has an estimated residual value of $5,000 and an estimated life of four years or 18,000 hours. What is the amount of depreciation for the second full year, using the double-declining-balance method? a. $17,500 b. $37,500 c. $18,750 d. $16,667
Equipment with a cost of $160,000 has an estimated residual value of $10,000 and an estimated life of 4 years or 12,000 hours. It is to be depreciated by the diminishing value method with a constant depreciation rate of 37.5% p.a. What is the amount of depreciation expense for the first full year, during which the equipment was used 3,300 hours? a. $60,000. b. $80,000. c. $56,250. d. $55,500.
A machine with a cost of $70,887.00 has an estimated residual value of $4,907.00 and an estimated life of 7 years or 16,219 hours. It is to be depreciated by the units-of-output method. What is the amount of depreciation for the second full year, during which the machine was used 3,855 hours? Do not round your intermediate calculations. $9,425.71 $18,851.43 $15,682.40 $16,848.72
A machine with a cost of $135,000 has an estimated residual value of $15,000 and an estimated life of 3 years or 15,000 hours. It is to be depreciated by the units-of-activity method. What is the amount of depreciation for the second full year, during which the machine was used 6,100 hours? a.$48,800 b.$33,800 c.$61,000 d.$6,100
A machine with a cost of $68,856 has an estimated residual value of $5,301 and an estimated life of 3 years or 15,143 hours. It is to be depreciated by the units-of-activity method. What is the amount of depreciation for the second full year, during which the machine was used 4,595 hours? Do not round your intermediate calculations. a. $21,185.00 b. $42,370.00 c. $19,285.16 d. $20,893.70
A machine with a cost of $120,000 has an estimated residual value of $15,000 and an estimated life of 5 years or 15,000 hours. It is to be depreciated by the units-of-activity method. What is the amount of depreciation for the second full year, during which the machine was used 5,000 hours? a. $5,000 b. $35,000 c. $45,000 d. $21,000

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A machine with a cost of $63,800 has an estimated residual value of $4,360 and an estimated life of 5 years or 16,664 hours. What is the amount of depreciation for the second full year, using the double-declining-balance method? a. $12,760.00 b. $25,520.00 c. $15,312.00 d. $23,776.00