A machine costing $212,800 with a four-year life and an estimated $18,000 salvage value is installed in Luther Company's factory onJanuary 1. The factory manager estimates the machine will produce 487,000 units of product during its life. It actually produces thefollowing units: 122,900 in Year 1, 124,000 in Year 2, 120,200 in Year 3, 129,900 in Year 4. The total number of units produced by theend of Year 4 exceeds the original estimate-this difference was not predicted. Note: The machine cannot be depreciated below itsestimated salvage value.Required:Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method.Note: Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar.Complete this question by entering your answers in the tabs below.Straight LineUnits ofProductionDoubledecliningbalanceCompute depreciation for each year (and total depreciation of all years combined) for the machine under the Double-declining-balance.Double-declining-balance Depreciation for theEnd of PeriodYearBeginning ofPeriod BookPeriodDepreciationRateDepreciationExpenseAccumulatedBook ValueDepreciationValueYear 150 %$0Year 250%0Year 350 %0Year 4Total50 %0$0<Units of ProductionDouble declining balance

Under straight line basis, depreciation is calculated in equal installments over a useful life of…

A machine costing $212,800 with a four-year life and an estimated $18,000 salvage value is installed in Luther Company's fac January 1. The factory manager estimates the machine will produce 487,000 units of product during its life. It actually produce following units: 122,900 in Year 1, 124,000 in Year 2, 120,200 in Year 3, 129,900 in Year 4. The total number of units produced end of Year 4 exceeds the original estimate-this difference was not predicted, Note: The machine cannot be depreciated be estimated salvage value. Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation n Note: Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar. Complete this question by entering your answers in the tabs below. Straight Line Units of Production Double declining balance Compute depreciation for each year (and total depreciation of all years combined) for the machine under the Double- declining-balance. Double-declining-balance Depreciation for the End of Period Year Beginning of Period Book Period Depreciation Rate Depreciation Expense Accumulated Book Value Depreciation Value Year 1 50 % $ 0 Year 2 50% 0 Year 3 50 % 0 Year 4 50 % 0 Total $ 0 < Units of Production Double declining balance >

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter3: Cost Behavior

Section: Chapter Questions

Problem 13E