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Bramble Corporation purchased machinery on January 1, 2022, at a cost of $300,000. The estimated useful life of the machinery is 4 years, with an estimated salvage value at the end of that period of $35,000. The company is considering different depreciation methods that could be used for financial reporting purposes.

Required:
Prepare separate depreciation schedules for the machinery using the straight-line method, and the declining-balance method using double the straight-line rate.

Sagot :

Jepessoaidn

Answer:

Straight-line method

Year           Depreciation              Book value

1                   $66,250                    $233,750

2                  $66,250                    $167,500

3                  $66,250                    $101,250

4                  $66,250                    $35,000

Declining-balance method

Year           Depreciation              Book value

1                   $150,000                  $150,000

2                  $75,000                    $75,000

3                  $37,500                    $37,500

4                  $2,500                      $35,000

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