Depreciation

# Depreciation - Revised Annual Depreciation 30500...

This preview shows pages 1–2. Sign up to view the full content.

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

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

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:...
View Full Document

## This note was uploaded on 04/04/2009 for the course ACC 321 taught by Professor Ahmedmokhtar during the Spring '09 term at Ain Shams University.

### Page1 / 2

Depreciation - Revised Annual Depreciation 30500...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online