Chapter 9, Problem 7ME

Calculating Partial-Year Depreciation

Calculate the amount of depreciation to report during the year ended December 31 for equipment that was purchased at a cost of $43,000 on October 1. The equipment has an estimated residual value of S3.000 and an estimated useful life of five years or 20,000 hours. Assume the equipment was used for 1,000 hours from October 1 to December 31 and the company uses (a) straight-line, (b) double-declining-balance, or (c) units-of-production depreciation.