Machiel Manufacturing acquired a $60,000 machine on January 1,20X9.The machine is estimated to have a useful life of 4 years,and a residual value of $10,000.For units-of-production depreciation purposes,the machine is expected to produce 500,000 units.If Machiel Manufacturing used straight-line depreciation,what will be the depreciation expense in 20X9?

Question

Quizplus · Accepted Answer

The straight-line depreciation method calculates depreciation by dividing the depreciable amount (cost minus residual value) by the useful life. The depreciable amount is $60,000 - $10,000 = $50,000. Dividing this by 4 years gives an annual depreciation expense of $12,500.

Machiel Manufacturing Acquired a $60,000 Machine on January 1,20X9