Question

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Exact Photo Service purchased a new color printer at the beginning of 2018 for $38,000. The printer is expected to have a four-year useful life and a $3,500 salvage value. The expected print production is estimated at 1,500,000 pages. Actual print production for the four years was as follows:

2018	390,000
2019	410,000
2020	420,000
2021	300,000
Total	1,520,000

The printer was sold at the end of 2021 for $1,650.

Required

Compute the depreciation expense for each of the four years, using units-of-production depreciation.(Round cost per unit to three decimal places.)

	Units of Production
2018
2019
2020
2021

Answer 1

Cost of printer				38000
Lless: Residual value estimated				3500
Depreciable cost				34500
Divide: Life in print pages				1500000
Depreciable cost per page				0.023
Year	Print Pages	Units taken	Dep rate	Actual dep
2018	390000	390000	0.023	8970
2019	410000	410000	0.023	9430
2020	420000	420000	0.023	9660
2021	300000	280000	0.023	6900
Total	1520000	1500000		34960
Note: Units of last year needs to be adjusted for e estiamted production.