In recent years, Jayme Company has purchased three machines. Because of frequent employee turnover in the accounting department, a different accountant was in charge of selecting the depreciation method for each machine, and various methods have been used. Information concerning the machines is summarized in the table below. Machine 1 Acquired Jan. 1, 2015 Cost Salvage Value Useful Life (in years) Depreciation Method $96,000 $12,000 8 2 July 1, 2016 3 Nov. 1, 2016 85,000 66,000 10,000 6,000 5 6 Straight-line Declining-balance Units-of-activity For the declining-balance method, Jayme Company uses the double-declining rate. For the units-of-activity method, total machine hours are expected to be 30,000. Actual hours of use in the first 3 years were: 2016, 800; 2017, 4,500; and 2018, 6,000. Compute the amount of accumulated depreciation on each machine at December 31, 2018. Accumulated Depreciation at December 31 MACHINE 1 MACHINE 2 MACHINE 3 If machine 2 was purchased on April 1 instead of July 1, what would be the depreciation expense for this machine in 2016? In 2017? Depreciation Expense 2016 2017

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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In recent years, Jayme Company has purchased three machines. Because of frequent employee turnover in the accounting department,
a different accountant was in charge of selecting the depreciation method for each machine, and various methods have been used.
Information concerning the machines is summarized in the table below.
Machine
1
Acquired
Jan. 1, 2015
Cost
Salvage
Value
Useful Life
(in years)
Depreciation
Method
$96,000
$12,000
8
2
July 1, 2016
3
Nov. 1, 2016
85,000
66,000
10,000
6,000
5
6
Straight-line
Declining-balance
Units-of-activity
For the declining-balance method, Jayme Company uses the double-declining rate. For the units-of-activity method, total machine
hours are expected to be 30,000. Actual hours of use in the first 3 years were: 2016, 800; 2017, 4,500; and 2018, 6,000.
Compute the amount of accumulated depreciation on each machine at December 31, 2018.
Accumulated Depreciation at December 31
MACHINE 1
MACHINE 2
MACHINE 3
If machine 2 was purchased on April 1 instead of July 1, what would be the depreciation expense for this machine in 2016? In 2017?
Depreciation Expense
2016
2017
Transcribed Image Text:In recent years, Jayme Company has purchased three machines. Because of frequent employee turnover in the accounting department, a different accountant was in charge of selecting the depreciation method for each machine, and various methods have been used. Information concerning the machines is summarized in the table below. Machine 1 Acquired Jan. 1, 2015 Cost Salvage Value Useful Life (in years) Depreciation Method $96,000 $12,000 8 2 July 1, 2016 3 Nov. 1, 2016 85,000 66,000 10,000 6,000 5 6 Straight-line Declining-balance Units-of-activity For the declining-balance method, Jayme Company uses the double-declining rate. For the units-of-activity method, total machine hours are expected to be 30,000. Actual hours of use in the first 3 years were: 2016, 800; 2017, 4,500; and 2018, 6,000. Compute the amount of accumulated depreciation on each machine at December 31, 2018. Accumulated Depreciation at December 31 MACHINE 1 MACHINE 2 MACHINE 3 If machine 2 was purchased on April 1 instead of July 1, what would be the depreciation expense for this machine in 2016? In 2017? Depreciation Expense 2016 2017
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