Hello! I need help with the following accounting question regarding the calculation of the amount of depreciation expenses calculated under the assumtpions attatched below. Thank you in advance! Calculate the amount of depreciation expense that Kingbird should record for Machine B each year of its useful life under thefollowing assumptions. (Round depreciation cost per unit to 2 decimal places, e.g. 12.25. Round final answers to O decimalplaces, e.g. 2,125.)(1) Kingbird uses the straight-line method of depreciation.(2)Kingbird uses the declining-balance method. The rate used is twice the straight-line rate.(3)Kingbird uses the units-of-activity method and estimates that the useful life of the machine is 162,000 units. Actualusage is as follows: 2022, 60,500 units; 2023, 45,500 units; 2024, 30,500 units; and 2025, 25,500 units.$$2022tA$2023Depreciation ExpenseLA$2024$$2025 On January 1, 2022, Kingbird Company purchased the following two machines for use in its production process.Machine A:Machine B:The cash price of this machine was $40,000. Related expenditures also paid in cash included: sales tax $2,250,shipping costs $100, insurance during shipping $70, installation and testing costs $100, and $100 of oil andlubricants to be used with the machinery during its first year of operations. Kingbird estimates that the useful life ofthe machine is 5 years with a $4,400 salvage value remaining at the end of that time period. Assume that thestraight-line method of depreciation is used.The recorded cost of this machine was $180,000. Kingbird estimates that the useful life of the machine is 4 yearswith a $11,520 salvage value remaining at the end of that time period.

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Description: Hello! I need help with the following accounting question regarding the calculation of the amount of depreciation expenses calculated under the assumtpions attatched below. Thank you in advance! Calculate the amount of depreciation expense that Kingb

Depreciation is an expense recorded by the business entity for the wear and tear of the fixed assets (except land). Depreciation is a non-cash expense.There are various methods of computing depreciation e.g. straight line method, diminishing balance method, sum of years' digit method etc. Cost of Machine = $ 180000Life of Machine = 4 yearsSalvage Value = $ 11520Depreciation each year = = $ 42120YearOpening BalanceDepreciation ExpenseCumulative DepreciationClosing Balance2022$180,000$42,120$42,120$137,8802023$137,880$42,120$84,240$95,7602024$95,760$42,120$126,360$53,6402025$53,640$42,120$168,480$11,520Rate of depreciation = = 50%YearOpening BalanceDepreciation RateDepreciation ExpenseCumulative DepreciationClosing Balance2022$180,00050.00%$90,000$90,000$90,0002023$90,00050.00%$45,000$135,000$45,0002024$45,00050.00%$22,500$157,500$22,5002025$22,50048.80%$10,980$168,480$11,520Life of Machine = 162000 unitsCost of machine = $ 180000Salvage Value = $ 11520Cost per unit = = $ 1.04 per unitYearActual usage (units)Depreciation per unitDepreciation Expense ($)2022605001.04629202023455001.04473202024305001.04317202025255001.0426520162000YearOpening BalanceDepreciation ExpenseCumulative DepreciationClosing Balance202218000062920629201170802023117080473201102406976020246976031720141960380402025380402652016848011520Depreciation ExpenseParticulars2022202320242025SLM$42120421204212042120Declining Method$90000450002250010980Units of activity$62920473203172026520

Business

Accounting

Calculate the amount of depreciation expense that Kingbird should record for Machine B each year of its useful life under the following assumptions. (Round depreciation cost per unit to 2 decimal places, e.g. 12.25. Round final answers to O decimal places, e.g. 2,125.) (1) Kingbird uses the straight-line method of depreciation. (2) Kingbird uses the declining-balance method. The rate used is twice the straight-line rate. (3) Kingbird uses the units-of-activity method and estimates that the useful life of the machine is 162,000 units. Actual usage is as follows: 2022, 60,500 units; 2023, 45,500 units; 2024, 30,500 units; and 2025, 25,500 units.

Calculate the amount of depreciation expense that Kingbird should record for Machine B each year of its useful life under the following assumptions. (Round depreciation cost per unit to 2 decimal places, e.g. 12.25. Round final answers to O decimal places, e.g. 2,125.) (1) Kingbird uses the straight-line method of depreciation. (2) Kingbird uses the declining-balance method. The rate used is twice the straight-line rate. (3) Kingbird uses the units-of-activity method and estimates that the useful life of the machine is 162,000 units. Actual usage is as follows: 2022, 60,500 units; 2023, 45,500 units; 2024, 30,500 units; and 2025, 25,500 units.

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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Concept explainers

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.

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Question

Hello! I need help with the following accounting question regarding the calculation of the amount of depreciation expenses calculated under the assumtpions attatched below. Thank you in advance!

Calculate the amount of depreciation expense that Kingbird should record for Machine B each year of its useful life under the
following assumptions. (Round depreciation cost per unit to 2 decimal places, e.g. 12.25. Round final answers to O decimal
places, e.g. 2,125.)
(1) Kingbird uses the straight-line method of depreciation.
(2)
Kingbird uses the declining-balance method. The rate used is twice the straight-line rate.
(3)
Kingbird uses the units-of-activity method and estimates that the useful life of the machine is 162,000 units. Actual
usage is as follows: 2022, 60,500 units; 2023, 45,500 units; 2024, 30,500 units; and 2025, 25,500 units.
$
$
2022
tA
$
2023
Depreciation Expense
LA
$
2024
$
$
2025

On January 1, 2022, Kingbird Company purchased the following two machines for use in its production process.
Machine A:
Machine B:
The cash price of this machine was $40,000. Related expenditures also paid in cash included: sales tax $2,250,
shipping costs $100, insurance during shipping $70, installation and testing costs $100, and $100 of oil and
lubricants to be used with the machinery during its first year of operations. Kingbird estimates that the useful life of
the machine is 5 years with a $4,400 salvage value remaining at the end of that time period. Assume that the
straight-line method of depreciation is used.
The recorded cost of this machine was $180,000. Kingbird estimates that the useful life of the machine is 4 years
with a $11,520 salvage value remaining at the end of that time period.

Definition Video Definition Accounting method wherein the cost of a tangible asset is spread over the asset's useful life. Depreciation usually denotes how much of the asset's value has been used up and is usually considered an operating expense. Depreciation occurs through normal wear and tear, obsolescence, accidents, etc. Video

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