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Perdue Company purchased equipment on October 1 for $50,860. The equipment was expected to have a useful life of three years, or 7,000 operating hours, and a residual value of $1,860. The equipment was used for 1,300 hours during Year 1, 2,500 hours in Year 2, 2,100 hours in Year 3, and 1,100 hours in Year 4.
Required:
Problem 1: Determine the amount of depreciation expense for the years ended December 31, Year 1, Year 2, Year 3, and Year 4, by (a) the straight-line method, (b) the units-of-activity method, and (c) the double-declining-balance method.
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