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AleksAgata [21]
4 years ago
10

Blossom Company purchased a new machine on October 1, 2017, at a cost of $66,000. The company estimated that the machine has a s

alvage value of $5,700. The machine is expected to be used for 70,000 working hours during its 6-year life. Compute the depreciation expense under the straight-line method for 2017 and 2018, assuming a December 31 year-end. (Round answers to 0 decimal places, e.g. 5,275.)
Business
1 answer:
Ugo [173]4 years ago
8 0

Answer:

Results are below.

Explanation:

Giving the following information:

Purchase price= $66,000

Salvage value= $5,700

Useful life= 6

F<u>irst, we need to calculate the annual depreciation using the following formula:</u>

<u></u>

Annual depreciation= (original cost - salvage value)/estimated life (years)

Annual depreciation= (66,000 - 5,700) / 6= 10,050

<u>2017:</u>

Annual depreciation= (10,050/12)*3= $2,512.5

<u>2018:</u>

Annual depreciation= $10,050

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