Question

University Car Wash built a deluxe car wash across the street from campus. The new machines cost $225,000 including installation. The company estimates that the equipment will have a residual value of $22,500. University Car Wash also estimates it will use the machine for six years or about 12,500 total hours. Actual use per year was as follows:

Year	Hours Used
1	3,100
2	1,600
3	1,700
4	2,300
5	2,100
6	1,700

Required:

1. Prepare a depreciation schedule for six years using the straight-line method. (Do not round your intermediate calculations.)
  

	UNIVERSITY CAR WASH Depreciation Schedule—Straight-Line End of year amounts Year Depreciation Expense Accumulated Depreciation Book Value 1 $33,750 $33,750   2 33,750 67,500   3 33,750 101,250   4 33,750 135,000   5 33,750 168,750   6 33,750 202,500   Total $202,500

2. Prepare a depreciation schedule for six years using the double-declining-balance method. (Do not round your intermediate calculations.)
  

	UNIVERSITY CAR WASH Depreciation Schedule—Double-Declining-Balance End of year amounts Year Depreciation Expense Accumulated Depreciation Book Value 1       2       3       4       5       6       Total $0

3. Prepare a depreciation schedule for six years using the activity-based method. (Round your "Depreciation Rate" to 2 decimal places and use this amount in all subsequent calculations.)
  

	UNIVERSITY CAR WASH Depreciation Schedule—Activity-Based End of year amounts Year Depreciation Expense Accumulated Depreciation Book Value 1       2       3       4       5       6       Total $0

Answer 1