Homework Answers
| Depreciation Schedules | |||||
| Method 1 : Straight Line Method | |||||
| Year Ended | 2014 | 2015 | 2016 | 2017 | 2018 |
| Opening Book Value | $ 60,000.00 | $ 55,416.67 | $ 41,666.67 | $ 27,916.67 | $ 14,166.67 |
| Annual depreciation (Note 1) | $ 4,583.33 | $ 13,750.00 | $ 13,750.00 | $ 13,750.00 | $ 9,166.67 |
| Accumulated Depreciation | $ 4,583.33 | $ 18,333.33 | $ 32,083.33 | $ 45,833.33 | $ 55,000.00 |
| Remaining Book Value | $ 55,416.67 | $ 41,666.67 | $ 27,916.67 | $ 14,166.67 | $ 5,000.00 |
| Note 1 : Calculation of Annual depreciation | |||||
| (Cost of machine - salvage value)/useful life | |||||
| (60000-5000)/4 | |||||
| 13750 | |||||
| Depreciation for Year 2014 - | |||||
| =(13750/12months)*4months | |||||
| 4583.333333 | |||||
| Depreciation for Year 2018 - | |||||
| =Depreciable Amount - Accumulated Depreciation till Year 2017 | |||||
| 9166.67 | |||||
| Depreciation Schedules | |||||
| Method 2 : Unit of Production Method | |||||
| Year Ended | 2014 | 2015 | 2016 | 2017 | 2018 |
| Opening Book Value | 60,000.00 | 54,775.00 | 39,375.00 | 26,725.00 | 13,525.00 |
| Units Produced | 9,500.00 | 28,000.00 | 23,000.00 | 24,000.00 | 19,000.00 |
| Annual depreciation (Note 1 and 2) | 5,225.00 | 15,400.00 | 12,650.00 | 13,200.00 | 8,525.00 |
| Accumulated Depreciation | 5,225.00 | 20,625.00 | 33,275.00 | 46,475.00 | 55,000.00 |
| Remaining Book Value | 54,775.00 | 39,375.00 | 26,725.00 | 13,525.00 | 5,000.00 |
| Note 1 : Calculation of Depreciable Amount | |||||
| (Cost of machine - salvage value) | |||||
| 55000 | |||||
| 55000 | |||||
| Note 2 : Depreciation per unit of production | |||||
| 0.55 | |||||
| 0.55 | |||||
| Note 3 : Depreciation for Year 2018 - | |||||
| =Depreciable Amount - Accumulated Depreciation till Year 2017 | |||||
| 8525 | |||||
| Depreciation Schedules | |||||
| Method 3 : Double Declining Balance Method | |||||
| Year Ended | 2014 | 2015 | 2016 | 2017 | 2018 |
| Opening Book Value | 60,000.00 | 50,000.00 | 25,000.00 | 12,500.00 | 6,250.00 |
| Annual depreciation (Note 1, 2, 3 &4) | 10,000.00 | 25,000.00 | 12,500.00 | 6,250.00 | 3,125.00 |
| Accumulated Depreciation | 10,000.00 | 35,000.00 | 47,500.00 | 53,750.00 | 56,875.00 |
| Remaining Book Value | 50,000.00 | 25,000.00 | 12,500.00 | 6,250.00 | 3,125.00 |
| Note 1 : Calculation of Straight Line Depreciation Percentage | |||||
| =100%/useful life = 0.25 | |||||
| Note 2 : Calculation of depreciation rate | |||||
| Depreciation Factor * Straight Line Depreciation Percentage | |||||
| =2*0.25 = 0.5 | |||||
| Note 3 : Depreciation for a period | |||||
| =Depreciation rate* book value at the Beginning | |||||
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