Question

2. On January 1, Anderson Cranes purchased a crane for $280,000. Anderson expects the crane to remain useful for eight years (1,200,000 lifts) and to have a residual value of $40,000. The company expects the crane to be used for 160,000 fts the first year. Read the requirements a. Compute the first year depreciation expense on the crane using the straight-line method Begin by selecting the formula to calculate the company's first-year depreciation on the crane using the straight-line method. Then enter the amounts and calculate the depreciation for the first year. - Straight-line depreciation b. Compute the first-year depreciation expense on the crane using the units of production method Before calculating the first-year depreciation on the crane using the units-of-production method, calculate the depreciation expense per unit. Select the formula, then enter the amounts and calculate the depreciation per unit. (Round depreciation per unit to two decimals, X.XX.) Depreciation per unit CL ( Now, select the formula, enter the amounts, and calculate the company's first-year depreciation on the crane using the units-of-production method. (Round depreciation expense to the nearest whole dollar.) Units-of-production depreciation ier Jw C. Comoute the first vear and second-vear deoreciation expense on the crane using the double-dechinino-balance method oth Nov Choose from any list or enter any number in the input fields and then continue to the next question. TO

Answer 1

Please give positive ratings so I can keep answering. It would help me a lot. Please comment if you have any query. Thanks!

Anderson Cranes
Purchase cost of Crane	280,000.00
Total cost of Crane	280,000.00	A
Residual Value	40,000.00	B
Depreciable Cost	240,000.00	C=A-B
Straight Line Method
Depreciable Value	240,000.00	See C
Life	8.00	D
Annual depreciation	30,000.00	E=C/D
Depreciation for first year under Straight Line method is $ 30,000.
Units of Production Method
Depreciable Value	240,000.00	See C
Life (Lift)	1,200,000.00	F
Depreciation per Lift	0.20	G=C/F
	H	I=H*G
	Lifts	Depreciation
Year 1	160,000.00	32,000.00
Depreciation for first year under Units of Production Method is $ 32,000.
					M	N=M*L
Double Declining Method			Date	Asset Cost	Depreciable Cost	Depreciation Expense	Accumulated depreciation	Book Value
Total cost of Truck	280,000.00	See A	1/3/2018	280,000.00				280,000.00
Life	5.00	See D	12/3/2018		280,000.00	112,000.00	112,000.00	168,000.00
Annual depreciation	56,000.00	J=A/D	12/3/2019		168,000.00	67,200.00	179,200.00	100,800.00
Depreciation rate	20.00%	K=J/A
Double Depreciation %	40.00%	L=K*2
Depreciation for first year under Double Declining Method is $ 112,000.
Depreciation for Second year under Double Declining Method is $ 67,200.