Question: I am stuck on this problem. Comparing three depreciation methods Dexter Industries purchased packaging equipment on January 8 for $108,000. The equipment was expected to
I am stuck on this problem.
Comparing three depreciation methods
Dexter Industries purchased packaging equipment on January 8 for $108,000. The equipment was expected to have a useful life of three years, or 21,600 operating hours, and a residual value of $5,400. The equipment was used for 8,640 hours during Year 1, 6,480 hours in Year 2, and 6,480 hours in Year 3.
Required:
1. Determine the amount of depreciation expense for the three years ending December 31, by (a) the straight-line method, (b) the units-of-activity method, and (c) the double-declining-balance method. Also determine the total depreciation expense for the three years by each method. Round the final answers for each year to the nearest whole dollar.
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