On January 2, 2018, the Jackson Company purchased equipment to
be used in its manufacturing process. The equipment has an
estimated life of eight years and an estimated residual value of
$32,250. The expenditures made to acquire the asset were as
follows:
| Purchase price | $ | 159,500 | |
| Freight charges | 2,400 | ||
| Installation charges | 4,500 | ||
Jackson’s policy is to use the double-declining-balance (DDB)
method of depreciation in the early years of the equipment’s life
and then switch to straight line halfway through the equipment’s
life.
Required:
1. Calculate depreciation for each year of the
asset’s eight-year life.
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On January 2, 2018, the Jackson Company purchased equipment to
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