Exercise 11-6 Martinez Company purchased equipment for $270,000 on October 1, 2017. It is estimated that...

50.1K

Verified Solution

Question

Accounting

Exercise 11-6 Martinez Company purchased equipment for $270,000on October 1, 2017. It is estimated that the equipment will have auseful life of 8 years and a salvage value of $15,000. Estimatedproduction is 40,800 units and estimated working hours are 19,700.During 2017, Martinez uses the equipment for 520 hours and theequipment produces 1,000 units. Compute depreciation expense undereach of the following methods. Martinez is on a calendar-year basisending December 31. (Round rate per hour and rate per unit to 2decimal places, e.g. 5.35 and final answers to 0 decimal places,e.g. 45,892.) (a) Straight-line method for 2017 $ (b) Activitymethod (units of output) for 2017 $ (c) Activity method (workinghours) for 2017 $ (d) Sum-of-the-years'-digits method for 2019 $(e) Double-declining-balance method for 2018 $

Answer & Explanation Solved by verified expert

3.6 Ratings (336 Votes)

a Straightline Method Annual depreciation Cost Salvage Value Estimated Useful Life 270000 15000 8 years 31875 Depreciation expense for 2017 31875 x 312 7969 b Activity units of output Method Depreciation expense per See Answer

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member

Transcribed Image Text

Exercise 11-6 Martinez Company purchased equipment for $270,000on October 1, 2017. It is estimated that the equipment will have auseful life of 8 years and a salvage value of $15,000. Estimatedproduction is 40,800 units and estimated working hours are 19,700.During 2017, Martinez uses the equipment for 520 hours and theequipment produces 1,000 units. Compute depreciation expense undereach of the following methods. Martinez is on a calendar-year basisending December 31. (Round rate per hour and rate per unit to 2decimal places, e.g. 5.35 and final answers to 0 decimal places,e.g. 45,892.) (a) Straight-line method for 2017 $ (b) Activitymethod (units of output) for 2017 $ (c) Activity method (workinghours) for 2017 $ (d) Sum-of-the-years'-digits method for 2019 $(e) Double-declining-balance method for 2018 $