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Question - Health Guard Labs recently purchased a new pill dispensing machine. The purchase price was $24,500, the estimated residual value was $10,000, and the estimated useful life is 5 years. Additional expenditures during the first year were as follows:
1) Sales Tax $750
2) Assembly $450
3) Maintenance Repairs $2,500
4) Replacement Parts $3,600
5) New battery life to increase energy efficiency $670
1) Determine the machine asset value at the end of year one. (I do know that sales tax and assembly should be included in the purchase price...just not really sure where to go from there).
2) Show the depreciation schedule for year one and two for the dispensing machine by using the straight line method.
3) Show the depreciation schedule for year one and two for the dispensing machine by using the double declining method.
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