Banko Inc. manufactures sporting goods. The following information applies to a machine purchased on January 1, Year 1: Purchase price Delivery cost Installation charge Estimated life. Estimated units Salvage estimate $ 83,200 $7,000 $ 3,000 a. Straight-line b. Double-declining-balanc c. Units of production 5 years 147,000 $ 5,000 During Year 1, the machine produced 43,000 units and during Year 2, it produced 45,000 units. Required Determine the amount of depreciation expense for Year 1 and Year 2 using each of the following methods: Year 1 Year 2
Banko Inc. manufactures sporting goods. The following information applies to a machine purchased on January 1, Year 1: Purchase price Delivery cost Installation charge Estimated life. Estimated units Salvage estimate $ 83,200 $7,000 $ 3,000 a. Straight-line b. Double-declining-balanc c. Units of production 5 years 147,000 $ 5,000 During Year 1, the machine produced 43,000 units and during Year 2, it produced 45,000 units. Required Determine the amount of depreciation expense for Year 1 and Year 2 using each of the following methods: Year 1 Year 2
Chapter1: Financial Statements And Business Decisions
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
Transcribed Image Text:Banko Inc. manufactures sporting goods. The following information applies to a machine purchased on January 1, Year 1:
$ 83,200
$7,000
$ 3,000
Purchase price
Delivery cost
Installation charge
Estimated life.
Estimated units
Salvage estimate
5 years
a. Straight-line
b. Double-declining-balance
c. Units of production
147,000
$ 5,000
During Year 1, the machine produced 43,000 units and during Year 2, it produced 45,000 units.
Required
Determine the amount of depreciation expense for Year 1 and Year 2 using each of the following methods:
Year 1
Year 2
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Step 1: Introduction Depreciation Accounting
VIEWStep 2: Calculate the Annual Depreciation Expense Using Straight Line Method
VIEWStep 3: Calculate the Depreciation Expense Using Double Declining Balance Method
VIEWStep 4: Calculate the Depreciation Expense Using Units of Production Method
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