Identify depreciation methods used Grove Co. acquired a production machine on January 1, 2013, at a cost of $240,000. The machine is expected to have a four-year useful life, with a salvage value of $40,000. The machine is capable of producing 50,000 units of product in its lifetime. Actual production was as follows: 11,000 units in 2013; 16,000 units in 2014; 14,000 units in 2015; and 9,000 units
in 2016.
Following is the comparative balance sheet presentation of the net book value of the production machine at December 31 for each year of the asset's life, using three alternative depreciation methods (items a-c):
|
Production Machine, Net of Accumulated Depreciation At December 31
|
|
Depreciation Method
|
2016
|
2015
|
2014
|
2013
|
|
a.
|
40,000
|
76,000
|
132,000
|
196,000
|
|
b.
|
40,000
|
40,000
|
60,000
|
120,000
|
|
c.
|
40,000
|
90,000
|
140,000
|
190,000
|
Required:
Identify the depreciation method used for each of the preceding comparative balance sheet presentations (items a-c). If a declining-balance method is used, be sure to indicate the percentage (150% or 200%).