Compute amount of accumulated depreciation on each machine

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Reference no: EM131792079

Problem

In recent years, Farr Company has purchased three machines. Because of frequent employee turnover in the accounting department, a different accountant was in charge of selecting the depreciation method for each machine, and various methods have been used. Information concerning the machines is summarized in the table below.

Machine

Acquired

Cost

Salvage
Value

Useful Life
(in years)

Depreciation
Method

1

Jan. 1, 2012

$96,000

$12,000

8

Straight-line

2

July 1, 2013

85,000

10,000

5

Declining-balance

3

Nov. 1, 2013

66,000

6,000

6

Units-of-activity

For the declining-balance method, Farr Company uses the double-declining rate. For the units-of-activity method, total machine hours are expected to be 30,000. Actual hours of use in the first 3 years were: 2013, 800; 2014, 4,500; and 2015, 6,000.

(a) Compute the amount of accumulated depreciation on each machine at December 31, 2015.

Reference no: EM131792079

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