On January 1, Manning Co. purchases and installs a new machine costing $324,000 with a five-year life and an estimated $30,000 salvage value. Management estimates the machine will produce 1,470,000 units of product during its life. Actual production of units is as follows: 355,600 in Year 1, 320,400 in Year 2, 317,000 in Year 3, 343,600 in Year 4, and 138,500 in Year 5. The total number of units produced by the end of Year 5 exceeds the original estimate—this difference was not predicted. Note: The machine cannot be depreciated below its estimated salvage value. Required:  Prepare a table  Units-of-production: Year Number of Units  Depreciation per Unit   Depreciation Expense  1       2       3       4       5       Totals       Double-declining-balance:                 Year Beginning Book Value Annual Depreciation (40% of book value) Accumulated Depreciation at Year-End Ending Book Value ($324,000 Cost less Accumulated Depreciation) 1         2         3         4         5         Totals                             Double-declining-balance rate:                 Straight-line rate Multiplied by (Double) DDB Rate

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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On January 1, Manning Co. purchases and installs a new machine costing $324,000 with a five-year life and an estimated $30,000 salvage value. Management estimates the machine will produce 1,470,000 units of product during its life. Actual production of units is as follows: 355,600 in Year 1, 320,400 in Year 2, 317,000 in Year 3, 343,600 in Year 4, and 138,500 in Year 5. The total number of units produced by the end of Year 5 exceeds the original estimate—this difference was not predicted. Note: The machine cannot be depreciated below its estimated salvage value.

Required: 

Prepare a table 

Units-of-production:
Year Number of Units  Depreciation per Unit   Depreciation Expense 
1      
2      
3      
4      
5      
Totals      
Double-declining-balance:      
         
Year Beginning Book Value Annual Depreciation (40% of book value) Accumulated Depreciation at Year-End Ending Book Value ($324,000 Cost less Accumulated Depreciation)
1        
2        
3        
4        
5        
Totals        
         
         
Double-declining-balance rate:      
         
Straight-line rate Multiplied by (Double) DDB Rate    
         
         
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