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Chapter 9 HW eBook Print Item 1. BE.09.09.ALGO Depreciation by Three Methods; Partial Years Layton Company purchased tool sharpening equipment on October 1 for $39,960. The equipment was expected to have a useful life of three years or 4,860 operating hours, and a residual value of $1,080. The equipment was used for 900 hours during Year 1, 1,700 hours in Year 2, 1,500 hours in Year 3, and 760 hours in Year 4. 2. EX.09.17.ALGO 3. PR.09.03B.ALGO Required: Determine the amount of depreciation expense for the years ended December 31, Year 1, Year 2, Year 3, and Year 4, by (a) the straight-line method, (b) the units-of- activity method, and (c) the double-declining-balance method. Note: FOR DECLINING BALANCE ONLY, round the multiplier to four decimal places. Then round the answer for each year to the nearest whole dollar. a. Straight-line method Year Amount Year 1 $ 3,240 Year 2 12,960 Year 3 12,960 Year 4 9,720 b. Units-of-activity method Year Amount Year 1 7,200 Year 2 13,600 Year 3 12,000 Year 4 $ 6,080 Check My Work Omore Check My Work uses remaining, Previous Chapter 9 HW eBook Print Item 1. BE.09.09.ALGO Year 1 7,200 Year 2 13,600 2. EX.09.17.ALGO Year 3 12,000 3. PR.09.03B.ALGO Year 4 $ 6,080 C. Double-declining-balance method Year Amount Year 1 $ 6,660 Year 2 $ 16,650 X Year 3 $ 7,400 Year 4 $ 2,620 X Feedback Check My Work Asset cost minus residual value equals depreciable cost. Sum the yearly depreciation to determine total depreciation. Annual units-of-output depreciation allocates the cost of the asset equally over the hours operated (hours). The double-declining rate is two times the straight-line rate. Book value is the asset cost minus accumulated depreciation. Compare the total depreciation for all methods over the time period. Recall that straight-line method allocates the depreciable cost of the asset equally over the period of use, while double-declining-balance method is an accelerated method. Check My Work Omore Check My Work uses remaining, Previous

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