Question

Check my work Problem 7-58 Determine depreciation under three methods (L07-4) The following information applies to the questions displayed below. Part 1 of 3 Cheetah Copy purchased a new copy machine. The new machine cost $108,000 including installation. The company estimates the equipment will have a residual value of $27,000. Cheetah Copy also estimates it will use the machine for four years or about 8,000 total hours. Actual use per year was as follows: Year 1.66 points Hours Used 3,000 2,000 1,600 2,400 eBook Problem 7-5B Part 1 Print Required: 1. Prepare a depreciation schedule for four years using the straight-line method. (Do not round your intermediate calculations.) References CHEETAH COPY Depreciation Schedule Straight-Line End of Year Amounts Depreciation Accumulated Expense Depreciation Book Value Year Total

Answer 1

	New Machine Cost=	$                       1,08,000.00
	Residual value=	$                          27,000.00
	Useful life=	4	Years
	Straight Line Depreciation Formula=(Cost-Residual Value)/Useful life
	Depreciation=($108000-$27000)/4=	$                          20,250.00
	Cheetah Copy
	Depreciation Schedule-Straight line
	End of Year Amount
	Year	Depreciation Expense	Accumulated Depreciation	Book Value
	1	$                          20,250.00	$                                20,250.00	$                   87,750.00
	2	$                          20,250.00	$                                40,500.00	$                   67,500.00
	3	$                          20,250.00	$                                60,750.00	$                   47,250.00
	4	$                          20,250.00	$                                81,000.00	$                   27,000.00
1)	Under Straightline method of Depreciation same amount of depreciation is charged each year.
2)	Year	Depreciation Expense	Accumulated Depreciation	Book Value
	1	$                          20,250.00	$                                20,250.00	($108000-$20250)
	2	$                          20,250.00	($20250+$20250)	($87750-$20250)
	3	$                          20,250.00	($40500+$20250)	($67500-$20250)
	4	$                          20,250.00	($60750+$20250)	($47250-$20250)