Question

On January 1, 2018, the Allegheny Corporation purchased machinery for $172,000. The estimated service life of the machinery is 10 years and the estimated residual value is $18,000. The machine is expected to produce 350,000 units during its life.

Required:
Calculate depreciation for 2018 and 2019 using each of the following methods.

1. Straight line.
2. Sum-of-the-years'-digits.
3. Double-declining balance.

4. One hundred fifty percent declining balance.
5. Units of production (units produced in 2018, 44,000; units produced in 2019, 39,000).

Calculate depreciation for 2018 and 2019 using straight line method.

	Straight-Line Depreciation Choose Numerator: / Choose Denominator: = Annual Depreciation Expense / = Depreciation Expense / = 0 Depreciation Expense 2018 2019

Calculate depreciation for 2018 and 2019 using sum-of-the-years' digits.

	Sum-of-the-years' digits depreciation Depreciable Base x Rate per Year = Depreciation Expense 2018 $172,000 x = 2019 $172,000 x =

Calculate depreciation for 2018 and 2019 using double-declining balance.

	Depreciation for the Period End of Period Annual Period Beginning of Period Book Value Depreciation Rate (%) Depreciation Expense Accumulated Depreciation Book Value 2018 $0 2019 $0

Answer 1