7.The Armageddon Company purchased machinery costing $384,000, having an expected useful life of 4 years and an estimated residual value of $48,000.
Required:
a.What depreciation method is being used if the first year's depreciation expense is $192,000?
b.What depreciation method is being used if the second year's depreciation expense is $84,000?
8.The Golden Broom Cleaning Service acquired new equipment:
Cost$118,400
Residual12,800
Estimated useful life8 years or 40,000 units
Required:
a.Determine the book value of the asset at the end of the THIRD year if the straight-line depreciation method is used.
b.Determine the depreciation expense for the SECOND year assuming double-declining balance method is used.
c.What would be the depreciation expense for the FIRST year if the units-of-production method is used and 6,000 units were produced?