Strong Metals Inc. purchased a new stamping machine at the beginning of the year

Question

Strong Metals Inc. purchased a new stamping machine at the beginning of the year at a cost of $800,000. The estimated residual value was $87,600. Assume that the estimated useful life was five years, and the estimated productive life of the machine was 274,000 units. Actual annu production was as follows Year Units 1 77,000 2 68,000 3 32,000 4 60,000 5 37,000 Required 1. Complete a separate depreciation schedule for each of the alternative methods. (Do not round your intermediate calculations.) a. Straight-line Net Depreciation Accumulated Year ExpenseDepreciation oolk Value At acquisition 4 b. Units-of-production Net ExpenseDepreciation ok Value Depreciation Accumulated Year At acquisition 4 c. Double-declining-balance Net Depreciation Accumulated Year ExpenseDepreciation ook Value At acquisition 4

Explanation / Answer

Prepare depreciation schedule : Straight line depreciation

Prepare depreciation schedule : Unit of production

Prepare depreciation schedule : Double declining

Year Depreciation expense Accumlated depreciation Net book value At acquisition 800000 1 142480 142480 657520 2 142480 284960 515040 3 142480 427440 372560 4 142480 569920 230080 5 142480 712400 87600

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