Question

please answer CORRECTLY!

Onion & Gray Industries purchased a new machine at the beginning of 2011 for $44,500. The company expected the machine to last for four years and have a salvage value of $500. The productive life of the machine was estimated to be 1,100,000 units. Yearly production was as follows: in 2011 it produced 57,000 units; in 2012 it produced 45,000 units; in 2013 it produced 26,000 units; and in 2014 it produced 972,000 units. Requirements a. Complete the depreciation schedule using the straight-line method. (Round your answers to the nearest dollar.) Acc. Dep. Book Value Depreciation Expense Year End of Year End of Year 2011 $ Cost of Equipment 44,500 44,500 44,500 44,500 2012 2013 2014

Answer 1

Depreciation schedule using Straight line method :- Year Cost of Equipment Depreciation Expense Depreciation Expense Book Value at end of year 44,500 11,000 11,000 11,000 22,000 33,500 22,500 44,500 2011 2012 2013 2014 44,500 11,000 11,500 33,000 44,000 44,500 11,000 500 Annual depreciation expense = (Cost - Salvage value)/Life Depreciation schedule using Double decling balance method :- Cost of Depreciation Accumulated Book Value at Year Depreciation Equipment Expense end of year Expense 2011 44,500 22,250 22,250 22,250 2012 44,500 11,125 33,375 11,125 2013 44,500 5,563 38,938 5,563 2014 44,500 5,063 44,000 500 Double decling balance rate is = (100%/4)2 = 50% Depreciation schedule using Activity method :- Accumulated Cost of Depreciation "Depreciation Year Equipment Book Value at end of year Expense Expense 44,500 2,280 42,220 1,800 2011 2012 2013 2014 40,420 2,280 4,080 5,120 44,500 44,500 1,040 39,380 44,500 38,880 44,000 500 Depreciation expense per units is = (Cost - salvage value)/Total units produced Depreciation expense per year is = Depreciation expense per unit * No of units produced in each year