Question

*Problem 9-08A In recent years, Oriole Company has purchased three machines. Because of frequent employee turnover in the accounting department, a different accountant was in charge of selecting the depreciation method for each machine, and various methods have been used. Information concerning the machines is summarized in the table below. Machine Useful Life (in years) Acquired Jan. 1, 2020 July 1, 2021 Nov. 1, 2021 Cost $129,000 76,000 66,100 Salvage Value $41,000 11,600 6,100 Depreciation Method Straight-line Declining-balance Units-of-activity 5 For the declining-balance method, Oriole Company uses the double-dedining rate. For the units-of-activity method, total machine hours are expected to be 30,000. Actual hours of use in the first 3 years were: 2021, 610; 2022, 5,600; and 2023, 7,300. Your answer is correct. Compute the amount of accumulated depreciation on each machine at December 31, 2023. MACHINE 1 MACHINE 2 MACHINE 3 $44,000 $154,112 27,020 Accumulated Depreciation at December 31 x Your answer is incorrect. Try again. If machine 2 was purchased on April 1 instead of July 1, what would be the depreciation expense for this machine in 20217 In 20227 Depreciation Expense

Answer 1

Answer: straight line melhodor @ machine (1) cost = $129000 salvage value = $46000 8 years Useful life = 129000 - 41000 depreciation per annum = - $ 11000 Total 2023 2oal 2022 2020 11000 կկա 11000 11000 11000 Depreciation for theogear ... Accumulated depreciation at december 31 - $44000 machine (2) declining balance meliodor cost = 76000 Salvage value = 11600 useful life = 5 years. depreciation rate of per straight line melhod: xloo weful life Ixloo - 20% - double declining depreciation Yale z 2% 20 = 404

2023 2022 year 2021 36480 Beginning Book value $ 76000 60800 14592 15200 depreciation for the year 24320 (60800x40°) (76600x40% 6) 21888 & 60800 $36480 Ending Book value . Accumulated depreciation = 15200 +24320 +14592 - $ sulle machine (3). – Units of Activity method :- cost = $66100 Salvage value = $6100 oseful life = 7 year. expected Total machine hours = 30,000 hours deprecable amount = cost - sallage value - 66100 - 6100 depreciable amount = $60,000

Can (ь) Depreciation ya year depreciable amount Total hours Actual hours for the year (1 x 8 610 202) 30,000 60,000 $ 1220 11200 5600 39,000 2022 60,000 1600 7300 30,000 60, boo 2013 $ 27020 Accumulated depreciation -$27020 machine (2):- It machine was purchased on April 1 instead of July 1, depreciation is calculated from April 1 onwards in 2001, in montly depreciation for the year 2021 - 76000 x 40%. = $22800 depreciation for the year 2022 - 16000- 22 800 x 40/ = $21283 Thanks