Question

Required information

[The following information applies to the questions displayed below.]

On January 1, 2021, the Allegheny Corporation purchased equipment for $319,000. The estimated service life of the equipment is 10 years and the estimated residual value is $22,000. The equipment is expected to produce 288,000 units during its life.

Required:
Calculate depreciation for 2021 and 2022 using each of the following methods.

3. Assume instead the equipment was purchased on October 1, 2021. Calculate depreciation for 2021 and 2022 using each of the two methods. Partial-year depreciation is calculated based on the number of months the asset is in service. (Do not round intermediate answers and round your answers to the nearest whole dollar amount.)

Required information (The following information applies to the questions displayed below.) On January 1, 2021, the Allegheny Corporation purchased equipment for $319,000. The estimated service life of the equipment is 10 years and the estimated residual value is $22,000. The equipment is expected to produce 288,000 units during its life. Required: Calculate depreciation for 2021 and 2022 using each of the following methods. 3. Assume instead the equipment was purchased on October 1, 2021. Calculate depreciation for 2021 and 2022 using each of the two methods. Partial-year depreciation is calculated based on the number of months the asset is in service. (Do not round intermediate answers and round your answers to the nearest whole dollar amount.) 2021 2022 Sum-of-the-years' digits One hundred fifty percent declining balance

Answer 1

Calculate depreciation

	2021	2022
Sum of the year digit	297000*10/55*3/12 = 13500	297000*10/55*9/12+297000*9/55*3/12 = 52650
One hundred fifty percent declining balance	319000*15%*3/12 = 11963	35887+319000*85%*15%*3/12 = 46055