On January 2, 2012, Alvarez Company purchased an electroplating machine to help manufacture a part for one of its key products. The machine cost $218,700 and was estimated to have a useful life of six years or 700,000 platings, after which it could be sold for $23,400.
Required
a. Calculate each year's depreciation expense for the period 2012-2017 under each of the following depreciation methods:
- Straight-line
- Double-declining balance.
- Units-of-production. (Assume annual production in platings of
- 140,000
- 180,000
- 100,000
- 110,000
- 80,000
- 90,000
b. Assume that the machine was purchased on September1, 2012. Calculate each year's depreciation expense for the period 2012-2018 under each of the following depreciation methods;
- Straight-line
- Double-declining balance.