Mondale Winery depreciates its equipment using the group met

Mondale Winery depreciates its equipment using the group method. The cost of equipment purchased in 2016 totaled $485,000. The estimated residual value of the equipment was $46,000 and the group depreciation rate was determined to be 12%. What is the annual depreciation for the group? Annual depreciation If equipment that cost $48.000 is sold in 2017 for $41,000, what amount of gain or loss will the company recognize for the sale? :0 Type here to search 3 4 5 6 7 8

Solution

Question 1(of 8) a) Group depreciation (Purchase price - Residual value)*Depreciation rate ($485000 - $46000)*12% 52680 b) Note - Assume that assets purchased on begging of 2016 and sell at the end of 2017 Purchase price $48,000 Depriciation for 2 years $10,829 Written down value at the end of 2017 37171.2 Selling value $41,000 Profit on sale of assets $3,829 Question 2(of 8) Depricaition for year 1 $3.62 *.86/2 $1.5566m Depricaition for year 2 $3.62*.96/2 $1.7376m