Depreciation

Depreciation - 0.25 $2,250 $6,000 $4,000 2004 7000 0.25...

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Straight-line depreciation Assumptions: Asset cost $10,000 purchased 12/31/00 Salvage value $1,000, 5 year useful life Depreciable cost = $10,000 - $1,000 = $9,000 Year Rate Book value 2001 20% $1,800 $1,800 $8,200 2002 20% $1,800 $3,600 $6,400 2003 20% $1,800 $5,400 $4,600 2004 20% $1,800 $7,200 $2,800 2005 20% $1,800 $9,000 $1,000 * $9,000 / 5 years Depreciation expense * Accumulated Deprecation
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Units of Production Assumptions: Asset cost $10,000 purchased 12/31/00 Salvage value $1,000, Depreciable Value = $10,000-1,000 Useful life in units = 36,000 units Dep. per unit = $9,000 / 36,000 units = $.25 per unit Year Book value 2001 7000 0.25 $1,750 $1,750 $8,250 2002 8000 0.25 $2,000 $3,750 $6,250 2003 9000
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Unformatted text preview: 0.25 $2,250 $6,000 $4,000 2004 7000 0.25 $1,750 $7,750 $2,250 2005 5000 0.25 $1,250 $9,000 $1,000 # of Units Rate per Unit Depreciation expense Accumulated Deprecation Double declining balance Assumptions: Asset cost $10,000 purchased 12/31/00 Salvage value $1,000, 5 year useful life Year Rate Book value 2001 $10,000 40% $4,000 $4,000 $6,000 2002 $6,000 40% $2,400 $6,400 $3,600 2003 $3,600 40% $1,440 $7,840 $2,160 2004 $2,160 40% $864 $8,704 $1,296 2005 $1,296 40% $296 $9,000 $1,000 * last year is adjusted to arrive a salvage value Beginning Book Value Depreciation expense * Accumulated Deprecation...
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Depreciation - 0.25 $2,250 $6,000 $4,000 2004 7000 0.25...

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