In recent years, Farr Company has purchased three machines. Because of frequent employee turnover in the accounting department, a different accountant was in charge of selecting the depreciation method for each machine, and various methods have been used. Information concerning the machines is summarized in the table below.
|
Machine
|
|
Acquired
|
|
Cost
|
|
Salvage
Value
|
|
Useful Life
(in years)
|
|
Depreciation
Method
|
| 1 |
|
Jan. 1, 2012 |
|
$96,000 |
|
$12,000 |
|
8 |
|
Straight-line |
| 2 |
|
July 1, 2013 |
|
85,000 |
|
10,000 |
|
5 |
|
Declining-balance |
| 3 |
|
Nov. 1, 2013 |
|
66,000 |
|
6,000 |
|
6 |
|
Units-of-activity |
For the declining-balance method, Farr Company uses the double-declining rate. For the units-of-activity method, total machine hours are expected to be 30,000. Actual hours of use in the first 3 years were: 2013, 800; 2014, 4,500; and 2015, 6,000.
1.) Compute the amount of accumulated depreciation on each machine at December 31, 2015.
Machine 1: $ Machine 2: $ Machine 3: $
2.) If machine 2 was purchased on April 1 instead of July 1, what would be the depreciation expense for this machine in 2013? In 2014?
Depreciation Expense - 2013: $ 2014: $