On January 1, 2021, a machine was installed at Gallagher Factory at a cost of $52,000. Its estimated residual value at the end of its estimated life of 4 years is $20,000. The machine is expected toproduce 128,000 units with the following production schedule:View the production schedule.Complete depreciation schedules for (a) straight-line, (b) units-of-production, and (c) double declining-balance at twice the straight-line rate.(a) Complete the depreciation schedule using the straight-line method.End ofYearCost ofEquipmentYearlyDepreciationExpenseAccumulatedDepreciation,End of YearBook Value, Endof Year2021202220232024- ☑Production Schedule2021: 25,000 units2022: 39,000 units2023:26,000 units2024: 38,000 unitsPrintDone

The objective of the question is to calculate the depreciation schedule using the straight-line…

Answered: On January 1, 2021, a machine was…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Bucker Company purchased a fabrication machine on January 1, 2020 for $55,000. The machine is expected to have an estimated useful of 5 years or 100,000 units produced. The machine is expected to have a residual value of $5,000 after the five years of use. a. Calculate the amount of depreciation each year using the straight-line method. b. Calculate the depreciation each year using the units-of-production method given the following usage: 2020: 22,000 units; 2021: 23,000 units; 2022: 21,000 units; 2023: 19,000 units; 2024: 15,000 units c. Calculate the depreciation each year using the double-declining balance method. d. Which of the three methods results in the lowest net income for 2021? e. Which of the three methods resuls in the lowest net income for 2024?
Bucker Company purchased a fabrication machine on January 1, 2020 for $55,000. The machine is expected to have an estimated useful of 5 years or 100,000 units produced. The machine is expected to have a residual value of $5,000 after the five years of use. a. Calculate the amount of depreciation each year using the straight-line method. b. Calculate the depreciation each year using the units-of-production method given the following usage: 2020: 22,000 units; 2021: 23,000 units; 2022: 21,000 units; 2023: 19,000 units; 2024: 15,000 units c. Calculate the depreciation each year using the double-declining balance method. d. Which of the three methods results in the lowest net income for 2021? e. Which of the three methods resuls in the lowest net income for 2024? ***Note: round all final…
On June 30, 2021, Prego Equipment purchased a precision laser-guided steel punch that has an expected capacity of 313,000 units and no residual value. The cost of the machine was $469,500 and is to be depreciated using the units-of- production method. During the six months of 2021, 37,000 units of product were produced. At the beginning of 2022, engineers estimated that the machine can realistically be used to produce only another 258,750 units. During 2022, 83,000 units were produced. Prego would report depreciation in 2022 of: Multiple Choice • $110,067. . $132,800. $166,500. $124,500. . .
On June 30, 2021, Prego Equipment purchased a precision laser-guided steel punch that has an expected capacity of 313,000 units and no residual value. The cost of the machine was $469,500 and is to be depreciated using the units-of-production method. During the six months of 2021, 37,000 units of product were produced. At the beginning of 2022, engineers estimated that the machine can realistically be used to produce only another 258,750 units. During 2022, 83,000 units were produced. Prego would report depreciation in 2022 of: Multiple Choice $110,067 $132,800. $166,500. $124,500. Mc Grav Hill
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%24 %24 %24 %24 Calculate the depreciation expense for the years indicated using the following methods. (Do not round intermediate ce round final answers to 0 decimal places, e.g. 5,275.) 1. Straight-line method for the fiscal years ended December 31, 2020 and 2021 2. Double-declining-balance method for the fiscal years ended December 31, 2020 and 2021 2020 2021 1. Straight-line 2. Double-declining balance
The cost of equipment purchased by Charleston, Inc., on June 1, 2020, is $89,000. It is estimated that the machine will have a $5,000 salvage value at the end of its service life. Its service life is estimated at 7 years, its total working hours are estimated at 42,000, and its total production is estimated at 525,000 units. During 2020, the machine was operated 6,000 hours and produced 55,000 units. During 2021, the machine was operated 5,500 hours and produced 48,000 units. Compute depreciation expense on the machine for the year ending December 31, 2020, and the year ending December 31, 2021, using the following methods. (d) Sum-of-the-years'-digits (e) Double-declining-balance (twice the straight-line rate)
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ord Company purchased a machine on January 2, 2019, for $70,000. The machine had an expected residual value of $10,000, an expected life of 8 years or 24,000 hours, and a capacity to produce 100,000 units. During 2019, Lord produced 12,000 units in 2,500 hours. In 2020, Lord produced 15,000 units in 3,000 hours. Required: 1 a. Prepare a schedule showing depreciation expense for 2019 and 2020 and the book value of the asset at the end of 2019 and 2020 for the Straight-line method. LORD COMPANY Deprecation Schedule Straight-line Beginning Book Value Depreciation Ending Book Value 2019 2020 b. Prepare a schedule showing depreciation expense for 2019 and 2020 and the book value of the asset at the end of 2019 and 2020 for the activity method based on hours worked. LORD COMPANY Depreciation Schedule Activity method: Hours worked Beginning Book Value Depreciation Ending Book Value 2019 2020 c. Prepare a…

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