An asset costs $210,000 and is classified as a ten-year asset. What is the annual depreciation...

 

Transcribed Image Text:

An asset costs $210,000 and is classified as a ten-year asset. What is the annual depreciation expense for the first three years under the straight-line and the modified accelerated cost recovery systems of depreciation? Be sure to apply the half-year convention to straight-line depreciation. Use Exhibit 9.4 to answer the question. Round your answers to the nearest dollar. Straight-line depreciation: Year 1 $ $ $ Accelerated cost recovery system of depreciation: 2 3 Year 1 Depreciation expense 2 3 Depreciation expense 49 S S Recovery Year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 3 Years 33.00% 45.00 15.00 7.00 Percentage of Cost Depreciated Over: 5 Years 20.00% 32.00 19.20 11.52 11.52 5.76 7 Years 14.28% 24.49 17.49 12.49 8.93 8.93 8.93 4.46 10 Years 10.00% 18.00 14.40 11.52 9.22 7.37 6.55 6.55 6.55 6.55 3.29 15 Years 5.00% 9.50 8.55 7.69 6.93 6.23 5.90 5.90 5.90 5.90 5.90 5.90 5.90 5.90 5.90 3.00 20 Year 3.799 7.22 6.68 6.18 5.71 5.28 4.89 4.52 4.46 4.46 4.46 4.46 4.46 4.46 4.46 4.46 4.46 4.46 4.46 4.46 2.25 An asset costs $210,000 and is classified as a ten-year asset. What is the annual depreciation expense for the first three years under the straight-line and the modified accelerated cost recovery systems of depreciation? Be sure to apply the half-year convention to straight-line depreciation. Use Exhibit 9.4 to answer the question. Round your answers to the nearest dollar. Straight-line depreciation: Year 1 $ $ $ Accelerated cost recovery system of depreciation: 2 3 Year 1 Depreciation expense 2 3 Depreciation expense 49 S S Recovery Year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 3 Years 33.00% 45.00 15.00 7.00 Percentage of Cost Depreciated Over: 5 Years 20.00% 32.00 19.20 11.52 11.52 5.76 7 Years 14.28% 24.49 17.49 12.49 8.93 8.93 8.93 4.46 10 Years 10.00% 18.00 14.40 11.52 9.22 7.37 6.55 6.55 6.55 6.55 3.29 15 Years 5.00% 9.50 8.55 7.69 6.93 6.23 5.90 5.90 5.90 5.90 5.90 5.90 5.90 5.90 5.90 3.00 20 Year 3.799 7.22 6.68 6.18 5.71 5.28 4.89 4.52 4.46 4.46 4.46 4.46 4.46 4.46 4.46 4.46 4.46 4.46 4.46 4.46 2.25

Answer rating: 100% (QA)

To Calculate Depreciation per year by using the Straight line Method Depreciation Initial investme... View the full answer