for 163900 on lanuary 2017 t is ostmated that the machenery

for $163,900 on lanuary ?, 2017, t is ostmated that the machenery will have useful ife of 20 years, salvage vahie? 14,700, production of 91,100 ts, and e depreciation under the straight-line, unts-of output, king hours, sum-of-the years-digits, and double-declining-balance methods. (Round intermediate calculations to 5 decimal places,o.g.1.56487 and final amswers to o decimal Do

Solution

(a) Straight Line :-

Purchase Price – Salvage value]/Useful Life

= (165900 – 14700)/20 =$ 7560

(b) Units of Output :

Purchase Price – Salvage value]/Total output during Useful Life

= (165900 – 14700)/91100 units = $ 1.65971

1.65971 * 12754 units = $ 21168

(c) Working Hours :-

(165900 – 14700)/46100 hrs = $ 3.27983

3.27983 * 13369 hrs = $ 43848

(d) Sum of year digit method :-

Total weights = 20+19+18+17+16+15+14+13+12+11+10+9+8+7+6+5+4+3+2+1 = 210

Depreciation = (165900 – 14700) * 20/210 = $ 14400

(e) Double Declining Balance :-

Rate of Depreciation = (1/20) * 2 = 0.1 or 10%

165900 * 10% = $ 16590