On January 1, 2021, Morrow Inc. purchased a spooler at a cost of $40,000. The equipment...
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On January 1, 2021, Morrow Inc. purchased a spooler at a cost of $40,000. The equipment is expected to last eight years and have a residual value of $4,000. During its eight-year life, the equipment is expected to produce 250,000 units of product. In 2021 and 2022, 42,000 and 76,000 units, respectively, were produced. Required: Compute depreciation for 2021 and 2022 and the book value of the spooler at December 31, 2021 and December 31, 2022, assuming the straight-line method is used. Depreciation Book value 2021 2022 On January 1, 2021, Morrow Inc. purchased a spooler at a cost of $40,000. The equipment is expected to last eight years and have a residual value of $4,000. During its eight-year life, the equipment is expected to produce 250,000 units of product. In 2021 and 2022, 42,000 and 76,000 units, respectively, were produced. Required: Compute depreciation for 2021 and 2022 and the book value of the spooler at December 31, 2021 and December 31, 2022, assuming the straight-line method is used. Depreciation Book value 2021 2022
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