Question

Can you please create me something similar to this example. Thank you

In Module 15, we look at Property, Plant and Equipment, Intangibles and Natural Resources. We also computed various methods of cost allocation. Think of the assets that you and your family own. Indicate one example that would use Units of Production, Straight-line, Double-Declining and Sum-of-the years’-digits methods. Given a brief explanation. As my examples:

Desktop computer

• Double Declining method
• Computers seem to be out of date so quickly, need an accelerated method of depreciation.

Lightbulbs

• Units of Production method
• Lightbulbs should last many years based upon usage.

Grandfather Clock

• Straight line
• Just ticks away, same number of minutes per day.

Kitchen Chairs

• Double-Declining
• Never had good luck with kitchen chairs, they wear out quickly at our house
• Need an accelerated method based upon years
• Hope to get four good years out of them.

Answer 1

Refrigerator:

We can use Straight line Method , as it lasts long and no need to depreciate early in its life as its usage wont be affected that much with increase in life

Mobile Phone:

We can use Double Decling method as they tend to be out of date very fastly , need to be depreciated more in early of its life.

Printer:

We can use Units of production method as it depletes with more usage rather than on time

GYM Equipment:

GYM Equipment lasts for long years with usage efficiency issues as time goes. So , it needs to be depreciated more in initial years and so Sum of Digits method can be utilized

However , the above methods can be used based on its usage , individual judgments may vary on the method to be applied

Happy Learning ....