Chapter 11, Problem 11.6E

1.

To determine

Depreciation:

Depreciation refers to the reduction in the monetary value of a fixed asset due to its wear and tear or obsolescence. It is a method of distributing the cost of the fixed assets over its estimated useful life. The following is the formula to calculate the depreciation.

$\text{Depreciation cost = }\frac{\text{Cost of the asset-Salvage value}}{\text{Estimated useful life of the asset}}$

To Calculate: The depreciation amount for the year 2016, and 2017 using straight-line method.

2.

To determine

To Calculate: The depreciation amount for the year 2016, and 2017 using sum-of-the years’ digits method.

3.

To determine

To Calculate: The depreciation amount for the year 2016, and 2017 using double-declining balance method.