Perdue Company purchased equipment on April 1 for $100,170. The equipment was expected to have a useful life of three years, or 8,100 operating hours, and a residual value of $2,970. The equipment was used for 1,500 hours during Year 1, 2,800 hours in Year 2, 2,400 hours in Year 3, and 1,400 hours in Year 4. Required: Determine the amount of depreciation expense for the years ended December 31, Year 1, Year 2, Year 3, and Year 4, by (a) the straight-line method, (b) units-of-activity method, and (c) the double-declining-balance method. Note: FOR DECLINING BALANCE ONLY, round the multiplier to four decimal places. Then round the answer for each year to the nearest whole dollar. a.  Straight-line method Year Amount Year 1 $ 24300 Year 2 $ 32400 Year 3 $ 32400 Year 4 $ 8100 b.  Units-of-activity method Year Amount Year 1 $ 18000 Year 2 $ 33600 Year 3 $ 28800 Year 4 $ 16800 c.  Double-declining-balance method Year Amount Year 1 $ ??? Year 2 $ ??? Year 3 $ ??? Year 4 $ ???

Question

Perdue Company purchased equipment on April 1 for $100,170. The equipment was expected to have a useful life of three years, or 8,100 operating hours, and a residual value of $2,970. The equipment was used for 1,500 hours during Year 1, 2,800 hours in Year 2, 2,400 hours in Year 3, and 1,400 hours in Year 4.

Required:

Determine the amount of depreciation expense for the years ended December 31, Year 1, Year 2, Year 3, and Year 4, by (a) the straight-line method, (b) units-of-activity method, and (c) the double-declining-balance method.

Note: FOR DECLINING BALANCE ONLY, round the multiplier to four decimal places. Then round the answer for each year to the nearest whole dollar.

a.  Straight-line method

Year Amount
Year 1 $ 24300
Year 2 $ 32400
Year 3 $ 32400
Year 4 $ 8100

b.  Units-of-activity method

Year Amount
Year 1 $ 18000
Year 2 $ 33600
Year 3 $ 28800
Year 4 $ 16800

c.  Double-declining-balance method

Year Amount
Year 1 $ ???
Year 2 $ ???
Year 3 $ ???
Year 4 $ ???

 

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Depreciation Accounting

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