Find the straight-line depriciation method

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Reference no: EM1312494

Choosing the method of depreciation with 30% tax rate, straight line or double declining depreciation.

The Capital Company purchased 3 machines in the past year. Information regarding these items is listed below:

Machine

Acquired

Cost

Salvage Value

Useful life

Depreciation Method

1

Jan 1, 2006

$120,000

$20,000

5 years

Straight-line

2

Jan 1, 2006

80,000

10,000

5 years

Double-declining

3

Sept 1, 2006

530,000

5,000

4 years

Units of production

Additional information: The total machine hours expected for machine 3 will be 12,000 hours. Actual machine hours used in the first three years were: 200 hours in 2006, 2,250 hours in 2007, and 2,500 hours in 2008
i) The Straight-line depriciation method.
ii) The Double-declining depriciation method.

Reference no: EM1312494

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