On July 1, 2020, SouthCo purchased machinery for $130,000. The estimated useful life of the machinery is 5 years and the estimated residual value is $15,000. The machine is expected to produce 230,000 units during its life. In 2020, SouthCo produced 15,000 units, and in 2021, they produced 20,000 units. Calculate depreciation for 2020 and 2021 using each of the following methods. Use partial -year depreciation by calculating the depreciation based on the number of months the asset is in service.

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter11: Long-term Assets
Section: Chapter Questions
Problem 4EB: Montello Inc. purchases a delivery truck for $25,000. The truck has a salvage value of $6,000 and is...
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On July 1, 2020, SouthCo purchased machinery for $130,000. The estimated useful life of the machinery is 5 years and the estimated residual value is $15,000. The machine is expected to produce
230,000 units during its life. In 2020, SouthCo produced 15,000 units, and in 2021, they produced 20,000 units. Calculate depreciation for 2020 and 2021 using each of the following methods. Use partial
-year depreciation by calculating the depreciation based on the number of months the asset is in service.
Transcribed Image Text:On July 1, 2020, SouthCo purchased machinery for $130,000. The estimated useful life of the machinery is 5 years and the estimated residual value is $15,000. The machine is expected to produce 230,000 units during its life. In 2020, SouthCo produced 15,000 units, and in 2021, they produced 20,000 units. Calculate depreciation for 2020 and 2021 using each of the following methods. Use partial -year depreciation by calculating the depreciation based on the number of months the asset is in service.
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