Consider a $6500 piece of machinery, with a 5-year depreciable life and an estimated $1200 salvage value

Question:

Consider a $6500 piece of machinery, with a 5-year depreciable life and an estimated $1200 . The projected utilization of the machinery when it was purchased, and its actual production to date, are shown below.

Compute the machinery depreciation schedule by each of the following methods:
(a) Straight line.
(b) Sum-of-years' -digits.
(c) Double declining balance.
(d) Unit of production (for first 2 years only).
(e) Modified accelerated cost recovery system.

Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...