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The Hilton Skating Club used straight-line depreciation for a used Zamboni ice-resurfacing machine that cost $53,500, under the assumption it would have a four-year life and a $1,000 trade-in value. After two years, the club determined that the Zamboni still had three more years of remaining useful life, after which it would have an estimated $4,450 trade-in value.
Required:
Problem 1. Calculate the Zamboni's book value at the end of its second year.
Problem 2. Calculate the amount of depreciation to be charged during each of the remaining years in the Zamboni's revised useful life.
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