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Problem 1 Comparing three depreciation methods Ch 9 Snoopy Industries purchased...

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Accounting

Problem 1 Comparing three depreciation methods Ch 9
Snoopy Industries purchased packaging equipment on January 3 for $84,000. The equipment was expected to have a useful life of four years, or 25,000 operating hours, and a residual value of $5,500. The equipment was used for 6,200 hours during Year 1,5,900 hours during Year 2,7,400 hours during Year 3, and 5,500 hours during Year 4.
1. Determine the amount of depreciation expense for the four years ending December 31 by (a) straight-line method, (b) the units-of-activity method, and (c) the double-declining-balance method. Also determine the total depreciation expense for the four years by each method.
2. What method yields the highest depreciation for Year 1?
3. What method yields the most depreciation over the four-year life of the equipment?

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