FINANCIAL ACCOUNTING II (ACC142) PROFESSOR: ANIL NAGAR STUDENT: LOVEPREET SINGH STUDENT ID: A00155606 1) To calculate the amount of accumulated depreciation on each machine on December 31, 2003, we will use the information provided on the depreciation method, residual value, useful life, and actual hours of use for each machine. Machine 1: Depreciation method: Straight-line Residual value: $7,000 Useful life: 10 years Accumulated depreciation = (cost - residual value) * (years used / useful life) = ($97,000 - $7,000) * (3 / 10) = $90,000 * 0.3 = $27,000
Machine 2: Depreciation method: Declining balance (double-declining rate) Residual value: $10,000 Useful life: 5 years Accumulated depreciation = (cost - residual value) * (depreciation rate) = ($110,000 - $10,000) * (2 * (1 - (3/5))) = $100,000 * 0.48 = $48,000
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