calculate depreciation on a piece of machinery using the following systems: given: cost of machine is $ 45,000; residual value $ 5,000; estimated useful life is 5 years. purchase happened on January 1, 2021. a. straight line depreciation for year 1____________and year 2____________________. b. double declining balance for Year 1_____________and year 2 ___________________ c. assuming a life use of 160,000 units what is the depreciation for year 1 if 30,000 units are manufactured__________________________.
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.
- calculate
depreciation on a piece of machinery using the following systems:
given: cost of machine is $ 45,000; residual value $ 5,000; estimated useful life is 5 years. purchase happened on January 1, 2021.
a. straight line depreciation for year 1____________and year 2____________________.
b. double declining balance for Year 1_____________and year 2 ___________________
c. assuming a life use of 160,000 units what is the depreciation for year 1 if 30,000 units are manufactured__________________________.
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