Super Saver Groceries purchased store equipment for $21,000. Super Saver estimates that at the end of its 10-year service life, the equipment will be worth $1,000.
During the 10-year period, the company expects to use the equipment for a total of 10,000 hours. Super Saver used the equipment for 1,500 hours the first year.
Required:
Calculate depreciation expense of the equipment for the first year, using each of the following methods. Round all amounts to the nearest dollar.
1. Straight-line.
2. Double-declining-balance.
3. Activity-based.