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On April 29, 2011, Quality Appliances purchased equipment for $260,000. The estimated service life of the equipment is six years and the estimated residual value is $20,000. Quality's fiscal year ends on December 31.
Required:
Calculate depreciation for 2011 and 2012 using each of the three methods listed. Quality calculates partial year depreciation based on the number of months the asset is in service. Round all computations to the nearest dollar.
1. Straight-line.
2. Sum-of-the-years' digits.
3. Double-declining balance.
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