Question

Tools Data Window 100% 22 A Sun Jan 19 22 45 06 Q E Excel File Edit ... AutoSave Home Insert Draw X Arial Pato BI 651 xv fx View Insert Format ABES Page Layout Formulas 10 A A O A Comments Data Review = = = Help ® 6.29 GB X ACCT& 202 Lab 1 Student Template Winter 2020-2 Tell me what you want to do ? Wraa Text General Merge & Center Merge & Center % : - Conditional Format Cell Formatting us Teble Styles View D Share % Ideas E 28- 0 - 2x Delete Format X S Find & Sensitivity 1 Given Data: LONDON CAR WASH Cost of now car wash machines Estimated residual value Machine life in years Machine life in hours $200,000 $ 20,000 10,000 Actual use per year: Hours Year Used 2,000 2,000 1,500 1,800 1,300 1,400 Lab 1 Given Data + !! 1 - 1 + 100% 110 ISO RODOL LATOJO AO 99x

Answer 1

	Cost of new car wash machines					200000
	Estimated residual value					20000
	Machine life in years					6	years
	Machine life in hours					10000	hours
		Year		Hours used
		1		2000
		2		2000
		3		1500
		4		1800
		5		1300
		6		1400
		Straight line method
	Year	Depreciable cost	x	Depreciation rate	=	Depreciation expense	Accumulated Depreciation	Book Value
	1	$200,000.00		15.00%		$30,000.00	$30,000.00	$170,000.00	Depreciation=	(Purchase price-residual value)/useful life
	2	$170,000.00		15.00%		$30,000.00	$60,000.00	$140,000.00		(200,000-20,000)/6
	3	$140,000.00		15.00%		$30,000.00	$90,000.00	$110,000.00		$30,000
	4	$110,000.00		15.00%		$30,000.00	$120,000.00	$80,000.00	Depreciation rate=	Depreciation/Cost*100
	5	$80,000.00		15.00%		$30,000.00	$150,000.00	$50,000.00		(30,000/200,000)*100
	6	$50,000.00		15.00%		$30,000.00	$180,000.00	$20,000.00		15.00%
		Double declining method
	Year	Beginning book value	x	Depreciation rate	=	Depreciation expense	Accumulated depreciation	Book value
	1	$200,000		33.33%		$66,667	$66,667	$133,333
	2	$133,333		33.33%		$44,444	$111,111	$88,889
	3	$88,889		33.33%		$29,630	$140,741	$59,259
	4	$59,259		33.33%		$19,753	$160,494	$39,506
	5	$39,506		33.33%		$13,169	$173,663	$26,337
	6	$26,337		24.06%		$6,337	$180,000	$20,000
		Depreciation rate as per double declinning method					1/useful life *100*2
							1/6*100*2
							33.33%
		Depreciation rate as per unit of production=					(Purchase price-residual value)/expected units
							(200,000-20,000)/10,000
							$18.00
	Year	Hours used	x	Depreciation rate	=	Depreciation expense	Accumulated Depreciation	Book value
	1	2000		$18		$36,000	$36,000	$164,000
	2	2000		$18		$36,000	$72,000	$128,000
	3	1500		$18		$27,000	$99,000	$101,000
	4	1800		$18		$32,400	$131,400	$68,600
	5	1300		$18		$23,400	$154,800	$45,200
	6	1400		$18		$25,200	$180,000	$20,000

1 2 3 4 5 200000 20000 Cost of new car wash machines Estimated residual value Machine life in years Machine life in hours years hours 10000 Year =C8+1 =C9+1 =C10+1 =C11+1 =C12+1 Hours used 2000 2000 1500 1800 1300 1400 13 14 16 Straight line method Depreciation= 17 Year 18 1 19 2 20 3 21 4 22 5 23 6 24 Depreciable cost =G2 =C18-G18 =C19-G19 =C20-G20 =C21-G21 =C22-G22 Depreciation rate =K23 =E18 =E19 =E20 =E21 =E22 Depreciation expense =C18*E18 =$C$18*E19 = $C$18*E20 =$C$18*E21 =$C$18*E22 = $C$18*E23 Accumulated Depreciation =G18 =H18+G19 =H19+G20 =H20+G21 =H21+G22 =H22+G23 Book Value =C18-G18 =C19-G19 =C20-G20 =C21-G21 =C22-G22 =C23-G23 (Purchase price-residual (200,000-20,000)/6 = (200000-20000)/6 Depreciation/Cost 100 (30,000/200,000)*100 =30000/200000 Depreciation rate= 25 26 Double declining method Depreciation es 27 Year 28 1 29 2 30 3 31 4 32 5 33 6 34 35 36 Beginning book value =C18 =128 =129 =130 I=131 =132 Depreciation rate as per doub Depreciation rate =H36 =E28 -E29 =E30 =E31 =G33/C33 Depreciation expense =C28*E28 =C29*E29 =C30*E30 =C31*E31 =C32*E32 =C33-133 Accumulated depreciation =G28 =H28+G29 =H29+G30 =H30+G31 =H31+G32 =H32+G33 1/useful life 100*2 1/6*100*2 =1/62 Book value =C28-G28 =C29-G29 =C30-G30 =C31-G31 =C32-G32 20000 37

38 39 Depreciation rate as per unit (Purchase price-residual value)/ (200,000-20,000)/10,000 =(200000-20000)/10000 41 42 43 Year 44 1 45 2 46 3 47 4 48 5 49 6 50 51 52 Erron Hours used =E8 =E9 =E10 =E11 =E12 =E13 Depreciation rate =$H$41 = $H$41 =$H$41 = SH$41 = $H$41 =$H$41 Depreciation expense =C44%E44 =C45*E45 =C46°E46 =C47%E47 =C48E48 =C49%E49 Accumulated Depreciation =G44 =H44+G45 =H45+G46 =H46+G47 =H47+G48 =H48+G49 Book value = $C$28-H44 =$C$28-H45 = $C$28-H46 =$C$28-H47 = $C$28-H48 = $C$28-H49

Paste the above solution in excel in the cell B2 to gate same referencing.