A machine with an original cost of $120,000 and no salvage value had an estimated useful...

A machine with an original cost of $120,000 and no salvage value had an estimated useful life of 6 years, but after 2 complete years, management decided that the orignal estimate of useful life should have been 8 years.

Using a T-Chart template, prepare the following entries:

A. Depreciation for Year 1

B. Depreciation for Year 2

C. Depreciation for Year 3

Expert Solution

ekkarill92 answered 1 year ago

A machine that cost $400,000 has an estimated residual value of $40,000 and an estimated useful...

A machine that cost $400,000 has an estimated residual value of $40,000 and an estimated useful life of four years. The company uses double-declining-balance depreciation. Required: 1. Calculate the machine's depreciable cost. 2. Calculate the machine's depreciation expense for each year. 3. Calculate the machine's accumulated depreciation and book value at the end of each year.

Consider a machine that has an initial cost of $126,000 and an estimated salvage value of...

Consider a machine that has an initial cost of $126,000 and an estimated salvage value of $27,000. After some analysis we conclude that this machine will have O&M costs of $1,850 per year but based on the faulty nature of this machine we will have to incur in major maintenance costs at the end of year 3 and 6. During year 3 we expect to pay $14,000 and for year we estimate a $16,500. The machine will have a useful...

Jaguar Corporation purchased a machine that had an original cost of $60,000 and an estimated residual...

Jaguar Corporation purchased a machine that had an original cost of $60,000 and an estimated residual value of $10,000. The useful life was expected to be 8 years and straight-line depreciation is used. At December 31, 2006 (Jaguar’s annual year-end), the book value of the machine was $35,000. Jaguar Corporation sold the machine for $32,000 cash on October 1, 2007. Required: (A) Prepare the journal entry to record depreciation expense for 2007 at Oct 1, 2007 for the machine. Round...

A new machine costs $120,000, has an estimated useful life of five years and an estimated...

A new machine costs $120,000, has an estimated useful life of five years and an estimated salvage value of $15,000 at the end of that time. It is expected that the machine can produce 210,000 widgets during its useful life. The New Times Company purchases this machine on January 1, 2017, and uses it for exactly three years. During these years the annual production of widgets has been 80,000, 50,000, and 30,000 units, respectively. On January 1, 2020, the machine...

A machine cost $1,128,000 on April 1, 2020. Its estimated salvage value is $136,000 and its...

A machine cost $1,128,000 on April 1, 2020. Its estimated salvage value is $136,000 and its expected life is 4 years. Calculate the depreciation expense by straight-line for 2020. (Round answer to 0 decimal places, e.g. 5,275.) Depreciation expense $ Calculate the depreciation expense by double-declining balance for 2021. (Round answer to 0 decimal places, e.g. 5,275.) Depreciation expense $ Calculate the depreciation expense by sum-of-the-years'-digits for 2021. (Round answer to 0 decimal places, e.g. 5,275.) Depreciation expense $

A machine which cost $300,000 is acquired on October 1, 2014. Its estimated salvage value is...

A machine which cost $300,000 is acquired on October 1, 2014. Its estimated salvage value is $30,000 and its expected life is eight years. Instructions (1) Calculate depreciation expense for 2014 and 2015 by each of the following methods, showing the figures used. (a) Double-declining balance (b) Sum-of-the-years'-digits (2) At the end of 2015, which method results in the larger accumulated depreciation amount? (Please explain how the percentages and fractions in months are derived)

Equipment with a ten-year estimated useful life and no salvage value is sold at the end...

Equipment with a ten-year estimated useful life and no salvage value is sold at the end of the third year of its useful life. How would using the straight-line method of depreciation instead of the double-declining balance method of depreciation affect revenues and expenses?

A machine that cost SAR 320,000 is owned by a cement factory. Salvage is estimated at...

A machine that cost SAR 320,000 is owned by a cement factory. Salvage is estimated at SAR 75,000. Compare book values for MACRS, DB (20%), DDB and standard SL depreciation over a 7-year recovery period.

Third Eye Blind purchases machine for manufacturing clothing for $100,000 with an original estimated useful life...

Third Eye Blind purchases machine for manufacturing clothing for $100,000 with an original estimated useful life of 5 years and residual value of $20,000. 7. After 2 years, demand for the clothing produced by the machine has declined and they estimate that the machine will yield net cash flows of 23,000 each of the next three years (assume cash flows occur at the end of the year). Assume a discount rate of 10% and straight-line depreciation. What impairment does Third...

Benson Company bought a machine costing $120,000 on 1 April 2015. Management estimated the useful life...

Benson Company bought a machine costing $120,000 on 1 April 2015. Management estimated the useful life to be 10 years and the residual value to be $20,000. On 1 January 2018, management revised the useful life and residual value of the machine. The remaining useful life was revised to 5 years while the residual value was revised to $10,000. The company’s financial year end is 31 December. Compute the depreciation expense, accumulated depreciation and net book value of the machine...

Question