Response to the following problem:
Assume a piece of equipment was purchased July 26, 2012, at a cost of $72,000. The estimated residual value is $5,400 with a useful life of 5 years. Assume a production life of 60,000 units. Compute the depreciation for years 2012 and 2013 using
(a) straight-line and
(b) units-of-production (in 2012, 5,000 units produced and in 2013, 18,000 units produced).