Question

Comparing Three Depreciation Methods Waylander Coatings Company purchased waterproofing equipment on January 6 for $502,200. The equipment was expected to have a useful life of four years, or 9,600 operating hours, and a residual value of $41,400. The equipment was used for 3,600 hours during Year 1, 3,000 hours in Year 2, 1,700 hours in Year 3, and 1,300 hours in Year 4.

Required:
Determine the amount of depreciation expense for the years ended December 31, Year 1, Year 2, Year 3, and Year 4, by (a) the straight-line method, (b) the units-of-activity method, and (c) the double-declining-balance method.

Answer 1

Answer:

Please find the complete question in the attached file.

Explanation:

$Year\ \ \ \ \ \ \ \text{Straight - line method} \ \ \ \ \ \ \text{Units-of-Activitymethod}\ \ \ \ \ \ \text{Double-declining-balance method}$$1\ \ \ \ \ \ \ \ \ 211,200\ \ \ \ \ \ \ \ \ 316,800\ \ \ \ \ \ \ \ \ 460,400\\\\2\ \ \ \ \ \ \ \ \ 211,200\ \ \ \ \ \ \ \ \ 264,000\ \ \ \ \ \ \ \ \ 230,200\\\\3\ \ \ \ \ \ \ \ \ 211,200\ \ \ \ \ \ \ \ \ 149,600\ \ \ \ \ \ \ \ \ 115,100\\\\4\ \ \ \ \ \ \ \ \ 211,200\ \ \ \ \ \ \ \ \ 114,400\ \ \ \ \ \ \ \ \ 39,100$

$Total\ \ \ \ \ \ \ \ \ 844,800\ \ \ \ \ \ \ \ \ 844,800\ \ \ \ \ \ \ \ \ 844,800$