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Emmar Co. purchased a machine on January 1, 2013 at a cost of 240000. The machine...

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Accounting

Emmar Co. purchased a machine on January 1, 2013 at a cost of240000. The machine had been estimated eight year life with noresidual value. Emmar uses straight line depreciation. At december31, 2016. Emmar estimated that the machine would have only two moreyears of remaining life with no residual value. For 2016, Emmarwould report delectation expense of

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3.8 Ratings (406 Votes)

For 2016, Emmar would report delectation expense of $12,857.14 or $12,857

Straight line Method for 2013 and onwards
A Cost $     2,40,000.00
B Residual Value $                        -  
C=A - B Depreciable base $     2,40,000.00
D Life [in years]                             8
E=C/D Annual SLM depreciation $        30,000.00
Depreciation schedule for first 4 years till dec 2016
Year Book Value Depreciation expense Ending Book Value Accumulated Depreciation
2013 $   2,40,000.00 $        30,000.00 $   2,10,000.00 $      30,000.00
2014 $   2,10,000.00 $        30,000.00 $   1,80,000.00 $      60,000.00
2015 $   1,80,000.00 $        30,000.00 $   1,50,000.00 $      90,000.00
Straight line Method for 2016 and onwards
A Cost $        90,000.00
B Residual Value $                        -  
C=A - B Depreciable base $        90,000.00
D Life [in years left ]                             7
E=C/D Annual SLM depreciation $        12,857.14

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