Problem
I. Apex Fitness Club uses straight-line depreciation for a machine costing $19,400, with an estimated four year life and a $2,950 salvage value. At the beginning of the third year, Apex determines that the machine has three more years of remaining useful life, after which it will have an estimated $2,500 salvage value.
Required:
i. Compute the machine's book value at the end of its second year.
ii. Compute the amount of depreciation for each of the final three years given the revised estimates.
II. Rayya Co. purchases and installs a machine on January 1, 2017, at a total cost of $92,400. Straight-line depreciation is taken each year for four years assuming a seven-year life and no salvage value. The machine is disposed of on July 1, 2021, during its fifth year of service.
The response should include a reference list. One-inch margins, Using Times New Roman 12 pnt font, double-space and APA style of writing and citations.