Katie's Garden Company purchased a machine on July 1, 2017. The machine cost $200,000 and has an estimated residual value of $20,000. The expected useful life is 8 years. The machine is to be used for 100,000 machine hours.
Required:
1. Calculate the depreciation expense for 2017 and 2018 using the straight-line method.
2. Calculate the depreciation expense for 2017 and 2018 using the units-of-production method. The machine was used for 8,000 machine hours in 2017 and 23,000 machine hours in 2018.
3. Calculate the depreciation expense for 2017 and 2018 using the double-declining-balance method.

Question

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The Answer of Katie's Garden Company purchased a machine on July 1, 2017. The machine cost $200,000 and has an estimated residual value of $20,000. The expected useful life is 8 years. The machine is to be used for 100,000 machine hours.
Required:
1. Calculate the depreciation expense for 2017 and 2018 using the straight-line method.
2. Calculate the depreciation expense for 2017 and 2018 using the units-of-production method. The machine was used for 8,000 machine hours in 2017 and 23,000 machine hours in 2018.
3. Calculate the depreciation expense for 2017 and 2018 using the double-declining-balance method.

Katie's Garden Company Purchased a Machine on July 1, 2017