Culver Automotive purchased equipment on October 1, 2024, at a total cost of $182,000. The machine has an estimated useful eight years or 100,000 hours, and an estimated residual value of $42,000. During 2024 and 2025, the machinery was used 6,300 14,700 hours, respectively. Calculate depreciation expense at December 31, 2024 and December 31, 2025, under the following depreciation methods: (Rou answers to O decimal places, e.g. 5,275. and Round Depreciation cost per unit to 1 decimal places, e.g. 527.5) Straight-line depreciation Units-of-production depreciation $ $ Double diminishing-balance depreciation $ 2024 $ $ +A $ 2025
Culver Automotive purchased equipment on October 1, 2024, at a total cost of $182,000. The machine has an estimated useful eight years or 100,000 hours, and an estimated residual value of $42,000. During 2024 and 2025, the machinery was used 6,300 14,700 hours, respectively. Calculate depreciation expense at December 31, 2024 and December 31, 2025, under the following depreciation methods: (Rou answers to O decimal places, e.g. 5,275. and Round Depreciation cost per unit to 1 decimal places, e.g. 527.5) Straight-line depreciation Units-of-production depreciation $ $ Double diminishing-balance depreciation $ 2024 $ $ +A $ 2025
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter18: Accounting For Long-term Assets
Section: Chapter Questions
Problem 3CE: A machine costing 350,000 has a salvage value of 15,000 and an estimated life of three years....
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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