Problem 8-2ADepreciation methodsP1A machine costing $257,500 with a four-year life and an estimated $20,000 salvage value is installed in Luther Company's factory on January 1.The factory manager estimates the machine will produce 475,000 units of product during its life. It actually produces the following units:220,000 in Year 1, 124,600 in Year 2, 121,800 in Year 3, and 15,200 in Year 4. The total number of units produced by the end of Year 4 exceeds theoriginal estimate-this difference was not predicted. Note: The machine cannot be depreciated below its estimated salvage value.Check Year 4: units-of-production depreciation, $4,300; DDB depreciation, $12,187RequiredPrepare a table with the following column headings and compute depreciation for each year (and total depreciation of all years page 340combined) for the machine under each depreciation method.YearStraight-LineUnits-of-ProductionDouble-Declining-Balance

To solve Problem 8-2A, we need to compute depreciation for each year using three methods:…

Answered: Problem 8-2A Depreciation methods P1 A…

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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MODULE 5 8-7 DISPOSAL OF ASSET Please read the problem below and provide the correct answer along with an explanation of the answer. Thank you! Dump It is selling a machine that no longer is large enough for the production requirements. Dump It has had the machien for 3 years and has depreicated it using the straightline method. Original cost had been $98,000 and salvage was estimated at $6000. The machine has a life of 8 years. a) Journalize the sale of the imagine $70,000 b) Journalize teh sale of the machine for $50,000
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mework Assignment i es C CON Required information Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Exercise 8-4 Straight-line depreciation LO P1 Esc Straight-Line Depreciation Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $47,500. The machine's useful life is estimated at 10 years, or 405,000 units of product, with a $7,000 salvage value. During its second year, the machine produces 34,500 units of product. Determine the machine's second-year depreciation and year end book value under the straight-line method. Choose Numerator: / Cost minus salvage $ Year 2 Depreciation Year end book value (Year 2) F1 F2 40,500/ Estimated useful life (years) $ ✔ F3 Choose Denominator: # Dashboard F4J 10 4,050 Prev. F5 % = = E Paraphrasing Tool .... Annual Depreciation Expense 1 Depreciation expense $ Saved S 2 3 F6 G A C logitech 4,050 of 9 F7 & Excelsior…
Unit VIII question 12
Exercise 10-13 (Algo) Revising depreciation LO C2 Apex Fitness Club uses straight-line depreciation for a machine costing $21,050, with an estimated four-year life and a $2,250 salvage value. At the beginning of the third year, Apex determines that the machine has three more years of remaining useful life, after which it will have an estimated $1,800 salvage value. 1. Compute the machine's book value at the end of its second year. 2. Compute the amount of depreciation for each of the final three years given the revised estimates. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the machine's book value at the end of its second year. Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar. Book Value at the End of Year 2: Cost Accumulated depreciation 2 years Book value at point of revision $ 0
"PR 10-2AComparing three depreciation methodsOBJ. 2Dexter Industries purchased packaging equipment on January 8 for $72,000. The equip-ment was expected to have a useful life of three years, or 18,000 operating hours, and a residual value of $4,500. The equipment was used for 7,600 hours during Year 1, 6,000 hours in Year 2, and 4,400 hours in Year 3.Instructions1.Determine the amount of depreciation expense for the three years ending December 31 by (a) the straight-line method, (b) the units-of-activity method, and (c) the double-declining-balance method. Also determine the total depreciation expense for the three years by each method. The following columnar headings are suggested for recording the depreciation expense amounts:Depreciation ExpenseYearStraight- Line MethodUnits-of- Activity MethodDouble-Declining- Balance Method2.What method yields the highest depreciation expense for Year 1?3.What method yields the most depreciation over the three-year life of the equipment"
2
QS 10-10 (Algo) Computing revised depreciation LO C2 On January 1, the Matthews Band pays $68,800 for sound equipment. The band estimates it will use this equipment for four years and after four years it can sell the equipment for $1,000. Matthews Band uses straight-line depreciation but realizes at the start of the second year that this equipment will last only a total of three years. The salvage value is not changed. Compute the revised depreciation for both the second and third years.
Exercise 6-18A (Static) Asset replacement decision LO 6-5 Tesla management are trying to decide whether to keep an older piece of machinery or buy a replacement. Management was presented with the following information to assist in their decision: • The old machine was purchased three years ago for $720,000 and has a current book value using straight-line depreciation of $400,000. • The old machine incurs operating expenses of $60,000 per year. • The current disposal value of the old machine is $170,000; if it is kept nine more years, its remaining value would be $20,000. • The replacement machine would cost $480,000 and have a useful life of nine years. • The replacement machine has an expected salvage value of $130,000 after nine years. • The replacement machine would require $26,000 per year in operating expenses. Required Calculate the total costs in keeping the old machine and purchase a new machine. Should the old machine be replaced? Keep Old Purchase New Machine Machine Total…
Exercise 8-10A Double-declining-balance and units-of-production depreciation: gain or loss on disposal LO 8-3, 8-4 (The following information applies to the questions displayed below.) Exact Photo Service purchased a new color printer at the beginning of Year 1 for $35,350. The printer is expected to have a four-year useful life and a $3,800 salvage value. The expected print production is estimated at $1,773,800 pages. Actual print production for the four years was as follows: 554,300 484,000 377,200 387,300 Year 1 Year 2 Year 3 Year 4 Total 1,802,800 The printer was sold at the end of Year 4 for $4,050. Exercise 8-10A Part b b. Compute the depreciation expense for each of the four years, using units-of-production depreciation. (Round cost per unit to three decimal places and final answers to the nearest whole dollar amount.) Depreciation Expense Year 1 Year 2 Year 3 Year 4 24 Total accumulated depreciation

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