Sophia Company purchased equipment costing $100,000. The equipment has a residual value of $20,000 and an estimated useful life of 50,000 units. Using the units-of-activity method, calculate thedepreciation for year 1 and year 2, assuming that the company produced 10,000 units in year 1 and 23,000 units in year 2. Year 1: Year 2:
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Sophia Company purchased equipment costing $100,000. The equipment has a residual value of $20,000 and an estimated useful life of 50,000 units. Using the units-of-activity method, calculate thedepreciation for year 1 and year 2, assuming that the company produced 10,000 units in year 1 and 23,000 units in year 2.
Year 1:
Year 2:
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- Dexter Industries purchased packaging equipment on January 8 for $314,600. The equipment was expected to have a useful life of three years, or 7,800 operating hours, and a residual value of $26,000. The equipment was used for 3,120 hours during Year 1, 2,418 hours in Year 2, and 2,262 hours in Year 3. Required: 1. Determine the amount of depreciation expense for the three years ending December 31, Year 1, Year 2, Year 3, 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. Note: For all methods, round the answer for each year to the nearest whole dollar. Depreciation Expense Year Straight-Line Method Units-of-Activity Method Double-Declining-Balance Method Year 1 $fill in the blank 1 $fill in the blank 2 $fill in the blank 3 Year 2 $fill in the blank 4 $fill in the blank 5 $fill in the blank 6 Year 3 $fill in the blank 7…Comparing Three Depreciation Methods Dexter Industries purchased packaging equipment on January 8 for $479,600. The equipment was expected to have a useful life of four years, or 8,000 operating hours, and a residual value of $39,600. The equipment was used for 2,800 hours during Year 1, 1,680 hours in Year 2, 2,240 hours in Year 3, and 1,280 hours in Year 4. Required: 1. Determine the amount of depreciation expense for the four 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 four years by each method. Round the answer for each year to the nearest whole dollar. Depreciation Expense Year Year 1 Year 2 Year 3 Year 4 Total Straight-Line Method Units-of-Activity Method 2. What method yields the highest depreciation expense for Year 1? Double-declining-balance method Double-Declining- Balance Method 3. What method yields the most depreciation over…Denver Co. purchased equipment for $225,000 on 12/1/x1. It is estimated that the equipment will have a useful life of 7 years and a residual value of $5,000. Estimated production is 30,000 units and estimated working hours are 25,000. During the month of December in 20x1, Denver used the equipment for 515 hours and the equipment produced 1,200 units. Compute depreciation expense under each of the following methods. Denver is on a calendar-year basis ending December 31, and is using the half-month convention. a) Sum-of-the-years' method for 20x2 (1/1/x2 ~ 12/31/x2) b) Double-declining balance method for 20x3 (1/1/x3 ~ 12/31/x3) c) Activity method (units of output) for 20x1 (12/1/x1 ~ 12/31/x1) d) Straight-line for 20x1(12/1/x1 ~ 12/31/x1)
