Question

The Lord Company purchased a machine on January 2, 2010, for $70,000. The machine had an expected residual value of $10,000, an expected life of eight years or 24,000 hours, and a capacity to produce 100,000 units. During 2010, the company produced 12,000 units in 2,500 hours. In 2011, the company produced 15,000 units in 3,000 hours.

Required
Prepare a schedule showing the depreciation for 2010 and 2011 and the book value of the asset at the end of 2010 and 2011 for each of the following methods:
1. Straight-line
2. Hours worked
3. Units of output



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  • CreatedDecember 09, 2013
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