Comparing Three Depreciation Methods Dexter Industries purchased packaging equipment on January 8 for $321,800. The...
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Comparing Three Depreciation Methods Dexter Industries purchased packaging equipment on January 8 for $321,800. The equipment was expected to have a useful life of three years, or 7,200 operating hours, and a residual value of $26,600. The equipment was used for 2,880 hours during Year 1, 2,232 hours in Year 2, and 2,088 hours in Year 3. Required: 1. Determine the amount of depreciation expense for the three years ending December 31, Year 1, Year 2, Year 3, by (a) the straight-line method, (b) the units-of-activity method, and (c) the double-declining-balance method. Also determine the total depreciation expense for the three years by each method. Note: For all methods, round the answer for each year to the nearest whole dollar. Depreciation Expense Units-of-Activity Method Double-Declining-Balance Method Year Straight-Line Method $ Year 1 Year 2 S $ Year 3 $ $ $ Total 2. What method yields the highest depreciation expense for Year 1? 3. What method yields the most depreciation over the three-year life of the equipment? @ 12:53
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