Question

Required information Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $45,900. The machine's useful life is estimated at 10 years, or 399,000 units of product, with a $6,000 salvage value. During its second year, the machine produces 33,900 units of product. Exercise 8-4 Straight-line depreciation LO P1 Determine the machine's second-year depreciation and year end book value under the straight-line method. Straight-Line Depreciation Choose Numerator: 1 Choose Denominator: Annual Depreciation Expense $ Beginning book value | 1 Estimated useful life (years) 45,9001 Year 2 Depreciation Year end book value (Year 2) Depreciation expense 100 = | 4,590 4,590

Answer 1

Cost minus salvage	/	Estimated useful life	=	Depreciation expense
39,900		10		3990

.

Year 2 Depreciation	3990
Year end book value (Year 2) = 45,900 - (2*3990)	37,920

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