A machine costing $216,000 with a four-year life and an estimated $20,000 salvage value is installed...

 

Transcribed Image Text:

A machine costing $216,000 with a four-year life and an estimated $20,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 490,000 units of product during its life. It actually produces the following units: 121,900 in 1st year, 123,800 in 2nd year, 120,200 in 3rd year, 134,100 in 4th year. The total number of units produced by the end of year 4 exceeds the original estimate this difference was not predicted. (The machine must not be depreciated below its estimated salvage value.) Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. (Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar.) (Ctrl) - Year 1 Year 1 2 3 4 Total 234 Units of Production Depreciable Units 121,900 $ 123,800 120,200 134,100 500,000 Depreciation per unit Beginning of Period Book Value $ 216,000 108,000 54,000 27,000✔ $ $ DDB Depreciation for the Period aeaeaeae 0.40 0.40 0.40 0.40 50 % $ 50 50 % 50 % Depreciation Expense Depreciation Depreciation Rate Expense $ 48,760 49,520 48,080 53,640 200,000 Straight Ling 108,000 $ 54,000✔ 27,000 13,500 S 202,500 End of Period Accumulated Depreciation Book Value 108,000 $ 108,000 162,000 54,000 189,000 27,000 202,500 13,500 A machine costing $216,000 with a four-year life and an estimated $20,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 490,000 units of product during its life. It actually produces the following units: 121,900 in 1st year, 123,800 in 2nd year, 120,200 in 3rd year, 134,100 in 4th year. The total number of units produced by the end of year 4 exceeds the original estimate this difference was not predicted. (The machine must not be depreciated below its estimated salvage value.) Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. (Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar.) (Ctrl) - Year 1 Year 1 2 3 4 Total 234 Units of Production Depreciable Units 121,900 $ 123,800 120,200 134,100 500,000 Depreciation per unit Beginning of Period Book Value $ 216,000 108,000 54,000 27,000✔ $ $ DDB Depreciation for the Period aeaeaeae 0.40 0.40 0.40 0.40 50 % $ 50 50 % 50 % Depreciation Expense Depreciation Depreciation Rate Expense $ 48,760 49,520 48,080 53,640 200,000 Straight Ling 108,000 $ 54,000✔ 27,000 13,500 S 202,500 End of Period Accumulated Depreciation Book Value 108,000 $ 108,000 162,000 54,000 189,000 27,000 202,500 13,500

Answer rating: 100% (QA)

d the bond length ... View the full answer