oncomflowconnecthtml Help Week 1 Practice Problems 6 2 On Ja

on.com/flow/connecthtml Help Week 1 Practice Problems 6 2 On January 4, 2019, Columbus Company purchased new equipment for $633,000 that had a useful life of four years and a salva value of $43,000 Required Prepare a schedule showing the annual depreciation and end-of year accumulated depreciation for the first three years of the a Ilfe under the straight-ine method, the sum-of-the years digits method, and the double-declining-balance method 25 Analyze If the double-declining balance method is used to compute depreciation, what woukd be the book value of the asset at the end c 2020? Complete this question by entering your answers in the tabs below. Straight LineDigs Doits DecliningAnalyze Prepare a schedule showing the annual depreciation and end of year accumulated depreciation for the first three years of the asset\'s life under the straight-line method Salrage Value Useful Life 2020 2021 C Prev 2 of 4 Score answer > 5 6

Solution

Straight line method

Year

Acquisition cost

salvage value

useful life

annual depreciation =(acquisition cost-salvage value)/no of years

Accumulated depreciation

2019

633000

43000

4

147500

147500

2020

633000

43000

4

147500

295000

2021

633000

43000

4

147500

442500

Double declining method

Straight line rate of depreciation

1/4

25%

double declining rate

.25*2

50%

Year

Book value of machine

Double declining rate

annual depreciation

Accumulated depreciation

Year end balance

2019

633000

50%

316500

316500

316500

2020

316500

50%

158250

474750

158250

2021

158250

50%

79125

553875

79125

Sum of year digit method

sum of year

4+3+2+1

10

Year

Book value of machine

salvage value

sum of year digit

annual depreciation

Accumulated depreciation

2019

633000

43000

4/10

236000

236000

2020

633000

43000

3/10

177000

413000

2021

633000

43000

2/10

118000

531000

Book value of asset at the end of year 2020 using double declining method

(633000-442500)

190500

Straight line method
Year	Acquisition cost	salvage value	useful life	annual depreciation =(acquisition cost-salvage value)/no of years	Accumulated depreciation
2019	633000	43000	4	147500	147500
2020	633000	43000	4	147500	295000
2021	633000	43000	4	147500	442500
Double declining method
Straight line rate of depreciation	1/4	25%
double declining rate	.25*2	50%
Year	Book value of machine	Double declining rate	annual depreciation	Accumulated depreciation	Year end balance
2019	633000	50%	316500	316500	316500
2020	316500	50%	158250	474750	158250
2021	158250	50%	79125	553875	79125
Sum of year digit method
sum of year	4+3+2+1	10
Year	Book value of machine	salvage value	sum of year digit	annual depreciation	Accumulated depreciation
2019	633000	43000	4/10	236000	236000
2020	633000	43000	3/10	177000	413000
2021	633000	43000	2/10	118000	531000
Book value of asset at the end of year 2020 using double declining method	(633000-442500)	190500