c. Double-declining-balance method2019 $2020 $d. Activity method based on hours worked2019 $2020 $e. Activity method based on units of output2019 $2020 $3. If Gruman used a service life of 8 years or 15,000 hours and a residual value of $9,000 , what would be the effect on the following under the straight-line, sum-of-the-years'-digits, and double-declining-balance depreciation methods?Depreciation expensea. Straight-line method2019 $2020 $b. Sum-of-the-years'-digits method2019 $2020 $c. Double-declining-balance method2019 $2020 $Book valuea. Straight-line method2019 $2020 $b. Sum-of-the-years'-digits method2019 $2020 $c. Double-declining-balance method2019 $2020 $ Depreciation MethodsGruman Company purchased a machine for $198,000 on January 2, 2019. It made the following estimates:Service life5 years or 10,000 hoursProduction180,000 unitsResidual value$ 18,000In 2019, Gruman uses the machine for 2,000 hours and produces 50,000 units. In 2020, Gruman uses the machine for 1,200 hours and produces 32,000 units. If required, round your final answers to the nearest dollar.Required:1. Compute the depreciation for 2019 and 2020 under each of the following methods:a. Straight-line method2019 $2020 $b. Sum-of-the-years'-digits method2019 $2020 $c. Double-declining-balance method2019 $2020 $d. Activity method based on hours worked2019 $2020 $e. Activity method based on units of output2019 $2020 $2. For each method, what is the book value of the machine at the end of 2019? At the end of 2020?a. Straight-line method2019 $2020 $b. Sum-of-the-years'-digits method2019 $2020 $c. Double-declining-balance method2019 $

Depreciation refers to the fall in the value of asset due to wear and tear, usage and obsolescence…

c. Double-declining-balance method 2019 $ 2020 $ d. Activity method based on hours worked 2019 $ 2020 $ e. Activity method based on units of output 2019 $ 2020 $ 3. If Gruman used a service life of 8 years or 15,000 hours and a residual value of $9,000 , what would be the effect on the following under the straight-line, sum-of-the-years'-digits, and double-declining-balance depreciation methods? Depreciation expense a. Straight-line method 2019 $ 2020 $ b. Sum-of-the-years'-digits method 2019 $ 2020 $ c. Double-declining-balance method 2019 $ 2020 $ Book value a. Straight-line method 2019 $ 2020 $ b. Sum-of-the-years'-digits method 2019 $ 2020 $ c. Double-declining-balance method 2019 $ 2020 $

c. Double-declining-balance method 2019 $ 2020 $ d. Activity method based on hours worked 2019 $ 2020 $ e. Activity method based on units of output 2019 $ 2020 $ 3. If Gruman used a service life of 8 years or 15,000 hours and a residual value of $9,000 , what would be the effect on the following under the straight-line, sum-of-the-years'-digits, and double-declining-balance depreciation methods? Depreciation expense a. Straight-line method 2019 $ 2020 $ b. Sum-of-the-years'-digits method 2019 $ 2020 $ c. Double-declining-balance method 2019 $ 2020 $ Book value a. Straight-line method 2019 $ 2020 $ b. Sum-of-the-years'-digits method 2019 $ 2020 $ c. Double-declining-balance method 2019 $ 2020 $

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Question

c. Double-declining-balance method
2019 $
2020 $
d. Activity method based on hours worked
2019 $
2020 $
e. Activity method based on units of output
2019 $
2020 $
3. If Gruman used a service life of 8 years or 15,000 hours and a residual value of $9,000 , what would be the effect on the following under the straight-line, sum-of-the-years'-digits, and double-declining-balance depreciation methods?
Depreciation expense
a. Straight-line method
2019 $
2020 $
b. Sum-of-the-years'-digits method
2019 $
2020 $
c. Double-declining-balance method
2019 $
2020 $
Book value
a. Straight-line method
2019 $
2020 $
b. Sum-of-the-years'-digits method
2019 $
2020 $
c. Double-declining-balance method
2019 $
2020 $

Depreciation Methods
Gruman Company purchased a machine for $198,000 on January 2, 2019. It made the following estimates:
Service life
5 years or 10,000 hours
Production
180,000 units
Residual value
$ 18,000
In 2019, Gruman uses the machine for 2,000 hours and produces 50,000 units. In 2020, Gruman uses the machine for 1,200 hours and produces 32,000 units. If required, round your final answers to the nearest dollar.
Required:
1. Compute the depreciation for 2019 and 2020 under each of the following methods:
a. Straight-line method
2019 $
2020 $
b. Sum-of-the-years'-digits method
2019 $
2020 $
c. Double-declining-balance method
2019 $
2020 $
d. Activity method based on hours worked
2019 $
2020 $
e. Activity method based on units of output
2019 $
2020 $
2. For each method, what is the book value of the machine at the end of 2019? At the end of 2020?
a. Straight-line method
2019 $
2020 $
b. Sum-of-the-years'-digits method
2019 $
2020 $
c. Double-declining-balance method
2019 $

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