Maserati spa purchased a new machine for its assembly process on August 1, 2019. The cost...

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Maserati spa purchased a new machine for its assembly process onAugust 1, 2019. The cost of this machine was 150,000. The companyestimated that the machine would have a residual value of 24,000 atthe end of its life. It’s life is estimated at 5 years and it’sworking hours are estimated at 21,000 hours. Year end is December31

Compute the depreciation expense under the following methods.Each of the following should be considered unrelated.
A. Straight line depreciation for 2019
B. Activity method for 2020 assuming that the machine usagewas 800 hours
C. Sum of the years digits for 2020
D. Double declining balance for 2020

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3.8 Ratings (533 Votes)

A Straight line depreciation for 2019 1050000 B Activity method for 2020 assuming that the machine usage was 800 hours 480000 C Sum of the years digits for 2020 See Answer

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Maserati spa purchased a new machine for its assembly process onAugust 1, 2019. The cost of this machine was 150,000. The companyestimated that the machine would have a residual value of 24,000 atthe end of its life. It’s life is estimated at 5 years and it’sworking hours are estimated at 21,000 hours. Year end is December31Compute the depreciation expense under the following methods.Each of the following should be considered unrelated.A. Straight line depreciation for 2019B. Activity method for 2020 assuming that the machine usagewas 800 hoursC. Sum of the years digits for 2020D. Double declining balance for 2020