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Depreciation

# Depreciation - Revised Annual Depreciation 30500...

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Schilling Corporation purchased a machine on January 1, 2002, at a total cost of \$900,000. The machine has an estimated useful life of 10 years or 1,000,000 units of output and a salvag Straight-Line Depreciation= in\$ 2002 2003 75000 75000 Units-of-Activity: \$ \$ Assume actual activity in terms of units of output was: 2002-60,000 units and 2003-120,000 un Depreciation per unit= Total Cost-Salvage Value/Totall Units Depreciation Expense = Actual Annual Units* Depreciation per Unit 2002 2003 45000 90000 Double-Declining-Balance: 2002 2003 Using the excel funcion \$180,000.00 \$144,000.00 The double-declining balance method computes depreciation at an accelerated rate. Depreciation is highest in the first period and decreases in successive periods. DDB uses the f cost - salvage(total depreciation from prior periods) * factor / life Depreciation as per the estimated life of 10 years Each year = Total Cost-SalvageValue/10 2001 2002 2003 22500 22500 22500 Book value 227500 205000 182500 Depreciaiton as per the estimated life of only 5 more years

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Unformatted text preview: Revised Annual Depreciation 30500 Double-Declining-Balance: 2002 2003 Using the excel funcion \$240,000.00 \$144,000.00 B. Melton Company bought machinery on January 1, 2001 at a cost of \$250,000. The machinery had an estimated life of 10 years and salvage value of \$25,000. In December 2003, Melton estimates that the machinery will have a life of only 5 more years and a \$30,000 salvage value. Melton uses straight-line depreciation. Compute the revised annual depreciation. C. Foster Company bought equipment on July 1, 2002 at a total cost of \$600,000. The equipment has an estimated useful life of 5 years and salvage value of \$120,000. Foster uses the double-declining-balance method of depreciation. Compute depreciation for 2002 and 2003. ge value of \$150,000. Total Cost-SalvageValue/10 75000 nits. 0.75 following formula to calculate depreciation for a period:...
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