Rottino Company purchased a new machine on October 1, 2014, at a cost of $150,000 The company estimated that the machine will have a salvage value of $12,000 The machine is expected to be used for 10,000 working hours during its 5 year life Instructions Compute the depreciation expense under the fo...

a Straightline method 150000120005 27600 per year 2014 depreciation 27600 ...

Rottino Company purchased a new machine on October 1, 2014, at a cost of $150,000. The company

Question:

Rottino Company purchased a new machine on October 1, 2014, at a cost of $150,000. The company estimated that the machine will have a of $12,000.
The machine is expected to be used for 10,000 working hours during its 5-year life.

Instructions
Compute the depreciation expense under the following methods for the year indicated.
(a) Straight-line for 2014.
(b) Units-of-activity for 2014, assuming machine usage was 1,700 hours.
(c) Declining-balance using double the straight-line rate for 2014 and 2015.

Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...