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is the depreciation calculated correctly?

On January 2, 2015, Athol Company bought a machine for use in operations. The machine has an estimated useful life of eight years and an estimated residual value of $1,800. The company provided the following information: a. Invoice price of the machine, $76,350. b. Freight paid by the vendor per sales agreement, $720. c. Installation costs, $1,640 cash. d. Cost of cleaning up the supplies, boxes, and other garbage that remained after the installation of the machine, $100 cash. e. Payment of the machine's price was made as follows: January 2: Issued 1,070 common shares of Athol Company at $5 per share. Signed a $45,000 note payable due April 16, 2015, plus 8 percent interest. Balance of the invoice price to be paid in cash. The invoice allows for a 2 percent cash discount if the cash payment is made by January 11. January 15: Paid the balance of the invoice price in cash. April 16: Paid the note payable and interest in cash. f. On June 30, 2017, the company completed the replacement of a major part of the machine that cost $12,275. This expenditure is expected to reduce the machine's operating costs, increase its estimated useful life by two years, and decrease its estimated residual value to $1,200. g. Assume that on October 1, 2022, the company decided to replace the machine with a newer, more efficient model. It then sold the machine to Sako Ltd. on that date for $25,600 cash. Required: 1. Compute the acquisition cost of the machine. Acquisition cost $ 77,470 4. Compute the depreciation expense for each of the years 2015, 2016, and 2017, assuming the company's fiscal year ends on December 31. Use the straight-line depreciation method. (Do not round intermediate calculations and round your final answers to the nearest dollar amount.) Depreciation expense 2015 $ 9,459 2016 $ 9,459 2017 $ 9,459 On January 2, 2015, Athol Company bought a machine for use in operations. The machine has an estimated useful life of eight years and an estimated residual value of $1,800. The company provided the following information: a. Invoice price of the machine, $76,350. b. Freight paid by the vendor per sales agreement, $720. c. Installation costs, $1,640 cash. d. Cost of cleaning up the supplies, boxes, and other garbage that remained after the installation of the machine, $100 cash. e. Payment of the machine's price was made as follows: January 2: Issued 1,070 common shares of Athol Company at $5 per share. Signed a $45,000 note payable due April 16, 2015, plus 8 percent interest. Balance of the invoice price to be paid in cash. The invoice allows for a 2 percent cash discount if the cash payment is made by January 11. January 15: Paid the balance of the invoice price in cash. April 16: Paid the note payable and interest in cash. f. On June 30, 2017, the company completed the replacement of a major part of the machine that cost $12,275. This expenditure is expected to reduce the machine's operating costs, increase its estimated useful life by two years, and decrease its estimated residual value to $1,200. g. Assume that on October 1, 2022, the company decided to replace the machine with a newer, more efficient model. It then sold the machine to Sako Ltd. on that date for $25,600 cash. Required: 1. Compute the acquisition cost of the machine. Acquisition cost $ 77,470 4. Compute the depreciation expense for each of the years 2015, 2016, and 2017, assuming the company's fiscal year ends on December 31. Use the straight-line depreciation method. (Do not round intermediate calculations and round your final answers to the nearest dollar amount.) Depreciation expense 2015 $ 9,459 2016 $ 9,459 2017 $ 9,459

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