On 1 January 2013, Zane Manufacturing Company purchased a machine for $40 000. The company expects to use the machine a total of 24 000 hours over the next 6 years. The estimated sales price of the machine at the end of 6 years is $4 000. The company used the machine 8 000 hours in 2013 and 12 000 in 2014. What is the depreciation expense for 2013 if the company uses straight- line depreciation?

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Quizplus · Accepted Answer

Depreciation expense = (Cost of machine - Estimated salvage value) / Estimated total hours of use= (40,000 - 4,000) / 24,000= 36,000 / 24,000= $1,500 per hourDepreciation expense for 2013 = 1,500 * 8,000 hours= $12,000

On 1 January 2013, Zane Manufacturing Company Purchased a Machine