Apex Fitness Club uses straight-line depreciation for a machine costing $30,700, with an estimated four-year life and a $2,250 salvage value. At the beginning of the third year, Apex determines that the machine has three more years of remaining useful life, after which it will have an estimated $1,800 salvage value. 1. Compute the machine’s book value at the end of its second year. 2. Compute the amount of depreciation for each of the final three years given the revised estimates.

1.) Compute the machine’s book value at the end of its second year. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar.

Book Value at the End of Year 2:
Cost
Accumulated depreciation 2 years
Book value at point of revision

2.) Compute the amount of depreciation for each of the final three years given the revised estimates. (Do not round intermediate calculations. Round your answers to the nearest whole dollar

Revised Depreciation (Years 3-5):

Book value at point of revision:

Revised salvage value:

Remaining depreciable cost:

Years of life remaining:

Revised annual depreciation years 3-5:

Answer rating: 100% (QA)

a Step 1 Cost of the Machine 30700 Salvage value 1800 Year of life 4 Years ... View the full answer