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Question - Swinton Company purchased a new machine on October 1, 2012, at a cost of $120,000.
The company estimated that the machine will have a salvage value of $12,000. The machine is expected to be used for 10,000 working hours during its 5-year life.
Required - Compute the depreciation expense under the following methods for the year indicated.
(a) Straight-line for 2012.
(b) Units-of-activity for 2012, assuming machine usage was 1,700 hours.
(c) Declining-balance using double the straight-line rate for 2012 and 2013.
Journalize the transactions of April 27, July 13, and October 8 and what is the balance in Paid-In Capital from Sale of Treasury Stock on December 31 of the current year?
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