Use the information on the Given Data worksheet to prepare three depreciation schedules using the following...
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Use the information on the Given Data worksheet to prepare three depreciation schedules using the following methods: straight-line, double-declining balance, and activity-based. Given Data: Cost of new car wash machines Estimated residual value Machine life in years Machine life in hours AUBURN CAR WASH Actual use per year: Hours Used Year 1 2 3 45 2,000 1,800 2,200 2,100 1,900 69 69 $ 800,000 50,000 5 10,000 Year 1 2 3 4 5 Total Year Total Year 1 Total 2 3 4 5 1 2 3 4 5 Calculation X End of Year Amounts Depreciable Depreciation Depreciation Accumulated Book Cost Expense Depreciation Value Rate Calculation Auburn Car Wash Straight Line Auburn Car Wash Double-Declining-Balance Beginning Depreciation Book Value X Rate Calculation X Hours Used = Depreciation Rate Auburn Car Wash Activity-Based Depreciation Accumulated = Expense Depreciation End of Year Amounts Book Value = End of Year Amounts Depreciation Accumulated Expense Depreciation Value Book Rectangular Ship If you hover your mouse over a cell with a red flag you will see the comment If you hover your mouse over a cell with a red flag you will see the comment Note: for year 5 you must make the year end book value equal to the Residual Value Therefore you will need to take the beginning book value less the Residual Value When you have completed all three schedules answer the following question. What do you observe about the Book Value at the end of the 5th year for all three methods? Type answer here-------> Use the information on the Given Data worksheet to prepare three depreciation schedules using the following methods: straight-line, double-declining balance, and activity-based. Given Data: Cost of new car wash machines Estimated residual value Machine life in years Machine life in hours AUBURN CAR WASH Actual use per year: Hours Used Year 1 2 3 45 2,000 1,800 2,200 2,100 1,900 69 69 $ 800,000 50,000 5 10,000 Year 1 2 3 4 5 Total Year Total Year 1 Total 2 3 4 5 1 2 3 4 5 Calculation X End of Year Amounts Depreciable Depreciation Depreciation Accumulated Book Cost Expense Depreciation Value Rate Calculation Auburn Car Wash Straight Line Auburn Car Wash Double-Declining-Balance Beginning Depreciation Book Value X Rate Calculation X Hours Used = Depreciation Rate Auburn Car Wash Activity-Based Depreciation Accumulated = Expense Depreciation End of Year Amounts Book Value = End of Year Amounts Depreciation Accumulated Expense Depreciation Value Book Rectangular Ship If you hover your mouse over a cell with a red flag you will see the comment If you hover your mouse over a cell with a red flag you will see the comment Note: for year 5 you must make the year end book value equal to the Residual Value Therefore you will need to take the beginning book value less the Residual Value When you have completed all three schedules answer the following question. What do you observe about the Book Value at the end of the 5th year for all three methods? Type answer here------->
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Solution Here are the three depreciation schedules StraightLine Depreciation ... View the full answer
Related Book For
Intermediate Accounting IFRS
ISBN: 978-1119372936
3rd edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
Posted Date:
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