text: , 26.12.2019Lamr
  
  # Mountain view resorts purchased equipment at the beginning of 2021 for \$46,000. residual value at the end of an estimated four-year service life is expected to be \$6,900. the machine operated for 1,600 hours in the first year and the company expects the machine to operate for a total of 10,000 hours over its four-year life. calculate depreciation expense for 2021, using each of the following depreciation methods: (1) straight-line, (2) double-declining-balance, and (3) activity-based.
  
  Answerthe maximum price that a buyer is willing to pay for a good;
  
  answer; /// i do believe that the above is (true)
  
  Straight line depreciation expense = \$9,775
  
  Double declining method = \$23,000
  
  unit of production method = \$6,256
  
  Explanation:
  
  Depreciation expense is used to expense the cost of asset.
  
  Depreciation expense using the straight line depreciation method = (cost of the equipment - Salvage value) / useful life
  
  (\$46,000 - \$6,900) / 4 = \$9,775
  
  The depreciation expense in 2021 is \$9,775.
  
  Depreciation expense using the double declining method = acceleration factor × net book value
  
  Acceleration factor = 2×(1/useful life)
  
  2(1/4) = 0.5
  
  = 0.5 × \$46, 000 = \$23,000
  
  Depreciation expense using the double declining method = \$23,000
  
  Depreciation expense using the unit of production method =Total use in a given period × [( Cost - Salvage value)/ total productive capacity]
  
  (\$46,000 - \$6,900) /10,000 = \$3.91 × 1600 =\$6,256
  
  Depreciation expense using the unit of production method = \$6,256
  
  I hope my answer helps you.
  
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