Use the following information to answer questions 1-5.
A pressurized spray painter was purchased on April 1 of the fiscal year for $3,900. It has a useful life of 4 years, and a residual value of $300.
1. Determine depreciation expense for year one using the straight-line method.
$300
$3900
$600
$675
2. Determine depreciation expense for year one using the double-declining-balance method.
$3900.00
$1462.50
$2437.50
$1500.00
3. Determine depreciation expense for two using the straight-line method.
$300
$3900
$600
$900
4. Determine depreciation expense for year two using the double-declining-balance method.
$1218.75
$3900
$2437.50
$1500.00
5. If the equipment is sold at the end of year one for $3225, what will be the gain or loss on the sale, assuming that the company used the straight line method of depreciation.
$1000
$100
$2225
$0