University Car Wash built a deluxe car wash across the street
from campus. The new machines cost $264,000 including installation.
The company estimates that the equipment will have a residual value
of $25,500. University Car Wash also estimates it will use the
machine for six years or about 12,500 total hours. Actual use per
year was as follows:
Year | Hours Used |
1 | 2,900 |
2 | 1,300 |
3 | 1,400 |
4 | 2,600 |
5 | 2,400 |
6 | 1,900 |
I need help preparing the depreciation schedule for six years using the double-depreciation method.
I need help preparing the depreciation schedule for six years using the activity-based method.
1) | Depreciation Schedule for six years using the double-depreciation method: | |||||
Year | Beginning book value | Depreciation expense | Ending Book Value | |||
a | b=a*0.3333 | c=a-b | ||||
1 | $ 2,64,000.00 | $ 87,999.99 | $ 1,76,000.01 | |||
2 | $ 1,76,000.01 | $ 58,666.66 | $ 1,17,333.35 | |||
3 | $ 1,17,333.35 | $ 39,111.11 | $ 78,222.23 | |||
4 | $ 78,222.23 | $ 26,074.08 | $ 52,148.16 | |||
5 | $ 52,148.16 | $ 17,382.72 | $ 34,765.44 | |||
6 | $ 34,765.44 | $ 11,588.48 | $ 23,176.96 | |||
Working: | ||||||
Straight line depreciation rate | = | 1/useful life | ||||
= | 1/6 | |||||
= | 0.16666667 | |||||
Double declining rate | = | 2*0.16667 | ||||
= | 0.33333333 | |||||
2) | Year | Beginning book value | Depreciation expense | Ending Book Value | ||
a | b | c=a-b | ||||
1 | $ 2,64,000.00 | $ 55,332.00 | $ 2,08,668.00 | |||
2 | $ 2,08,668.00 | $ 24,804.00 | $ 1,83,864.00 | |||
3 | $ 1,83,864.00 | $ 26,712.00 | $ 1,57,152.00 | |||
4 | $ 1,57,152.00 | $ 49,608.00 | $ 1,07,544.00 | |||
5 | $ 1,07,544.00 | $ 45,792.00 | $ 61,752.00 | |||
6 | $ 61,752.00 | $ 36,252.00 | $ 25,500.00 | |||
Working: | ||||||
Depreciation rate per hour | = | (Cost - Salvage Value)/Useful life | ||||
= | (264000-25500)/12500 | |||||
= | $ 19.08 | |||||
Year | Machine usage in hours | Depreciation rate per hour | Depreciation expense | |||
a | b | c=a*b | ||||
1 | 2900 | $ 19.08 | $ 55,332.00 | |||
2 | 1300 | $ 19.08 | $ 24,804.00 | |||
3 | 1400 | $ 19.08 | $ 26,712.00 | |||
4 | 2600 | $ 19.08 | $ 49,608.00 | |||
5 | 2400 | $ 19.08 | $ 45,792.00 | |||
6 | 1900 | $ 19.08 | $ 36,252.00 | |||
University Car Wash built a deluxe car wash across the street from campus. The new machines...
University Car Wash built a deluxe car wash across the street from campus. The new machines cost $237,000 including installation. The company estimates that the equipment will have a residual value of $28,500. University Car Wash also estimates it will use the machine for six years or about 12,500 total hours. Actual use per year was as follows: Year 2 2 3 4 5 6 Hours Used 2,700 2,000 2,100 1,900 1,700 2,100 3. Prepare a depreciation schedule for six...
University Car Wash built a deluxe car wash across the street from campus. The new machines cost $237,000 including installation. The company estimates that the equipment will have a residual value of $28,500. University Car Wash also estimates it will use the machine for six years or about 12,500 total hours. Actual use per year was as follows: Year 1 2 3 4 5 6 Hours Used 2,700 2,000 2,100 1,900 1,700 2,100 Required: 1. Prepare a depreciation schedule for...
University Car Wash built a deluxe car wash across the street from campus. The new machines cost $246,000 including installation. The company estimates that the equipment will have a residual value of $27,000. University Car Wash also estimates it will use the machine for six years or about 12,000 total hours. Actual use per year was as follows: Year Hours Used 1 2,800 2 1,900 3 2,000 4 2,000 5 1,800 6 1,500 2. Prepare a depreciation schedule for six...
University Car Wash built a deluxe car wash across the street from campus. The new machines cost $237,000 including installation. The company estimates that the equipment will have a residual value of $28,500. University Car Wash also estimates it will use the machine for six years or about 12,500 total hours. Actual use per year was as follows Hours Used 2,700 2,000 2,100 1,900 1,700 2,100 Year 4 5 6 2Prepare a depreciation schedule for six years using the double-declining-balance...
University Car Wash built a deluxe car wash across the street from campus. The new machines cost $246,000 including installation. The company estimates that the equipment will have a residual value of $27,000. University Car Wash also estimates it will use the machine for six years or about 12,000 total hours. Actual use per year was as follows: Year Hours Used 1 2,800 2 1,900 3 2,000 4 2,000 5 1,800 6 1,500 3. Prepare a depreciation schedule for six...
University Car Wash built a deluxe car wash across the street from campus. The new machines cost $246,000 including installation. The company estimates that the equipment will have a residual value of $27,000. University Car Wash also estimates it will use the machine for six years or about 12,000 total hours. Actual use per year was as follows: Year Hours Used 1 2,800 2 1,900 3 2,000 4 2,000 5 1,800 6 1,500 3. Prepare a depreciation schedule for six...
University Car Wash built a deluxe car wash across the street from campus. The new machines cost $234,000 including installation. The company estimates that the equipment will have a residual value of $27,000. University Car Wash also estimates it will use the machine for six years or about 12,000 total hours. Actual use per year was as follows: Year Hours Used 1 2,800 2 1,900 3 2,000 4 2,000 5 1,800 6 1,500 Required: 1. Prepare a depreciation schedule for...
Required information The following information applies to the questions displayed below.] University Car Wash built a deluxe car wash across the street from campus. The new machines cost $249,000 including installation. The company estimates that the equipment will have a residual value of $25,500. University Car Wash also estimates it will use the machine for six years or about 12,500 total hours. Actual use per year was as follows: Year Hours Used 2,900 1,800 1,900 2,100 1,900 1,900 ܠܐ ܕ...
Required information The following information applies to the questions displayed below) University Car Wash built a deluxe car wash across the street from campus. The new machines cost $237,000 including Installation. The company estimates that the equipment will have a residual value of $28,500. University Car Wash also estimates it will use the machine for six years or about 12,500 total hours. Actual use per year was as follows: WN Hours Used 2,700 2,000 2,100 1,900 1,700 2,100 repare a...
[The following information applies to the questions displayed below.] University Car Wash built a deluxe car wash across the street from campus. The new machines cost $267,000 including installation. The company estimates that the equipment will have a residual value of $24,000. University Car Wash also estimates it will use the machine for six years or about 12,000 total hours. Actual use per year was as follows: Year Hours Used 3,000 1,200 1,300 2,700 2,500 1,300 6 N m LO...