Depreciation Methods
Response to the following problem:
Berkshire Corporation purchased a copying machine for $9,800 on January 1, 2013. The machine's residual value was $1,175 and its expected life was 5 years or 2,000,000 copies. Actual usage was 480,000 copies the first year and 446,000 the second year.
Required:
1. Compute depreciation expense for 2013 and 2014 using the:
a. Straight-line method. Depreciation expense: $ 1,725 per year
b. Double-declining-balance method.
c. Units-of-production method. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar.)
2. For each depreciation method, what is the book value of the machine at the end of 2013? At the end of 2014? If required, round your answers to the nearest whole dollar.
a. Straight-line method
b. Double-declining-balance method
c. Units-of-production method .