Question

Sterling Steel Company purchased a new stamping machine at the beginning of the year at a cost of $ 580,000. The estimated residual value was $ 60,000. Assume that the estimated useful life was five years and the estimated productive life of the machine was 260,000 units. Actual annual production was as follows:
Required:
1. Complete a separate depreciation schedule for each of the alternative methods. Round your computations to the nearest dollar.
a. Straight-line
b. Units- of- production
c. Double- declining- balance
2. Assuming that the machine was used directly in the production of one of the products that the company manufactures and sells, what factors might management consider in selecting a preferable depreciation method in conformity with the matching process?


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  • CreatedAugust 04, 2015
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