Question: Problem #2: Depreciation Methods (SHOW YOUR WORK) Numo Company purchased a new machine on October 1, 2020, at a cost of $145,000. The company estimated

Problem #2: Depreciation Methods (SHOW YOUR WORK)

Numo Company purchased a new machine on October 1, 2020, at a cost of $145,000. The company estimated that the machine will have a salvage value of $25,000.The machine is expected to be used for 20,000 working hours during its 5-year life.

Instructions Compute the depreciation expense under the following methods for the year indicated.

(a) Straight-line for 2020.

(b) Units-of-activity for 2020, assuming machine usage was 3,400 hours.

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