Answer:
<u>straight line depreciation:</u>
depreciation expense per year, the same for every year = ($60,000 - $12,000) / 14 = $3,428.57
book value end of year 1 = $56,571.43
book value end of year 2 = $53,142.86
book value end of year 3 = $49,714.29
book value end of year 4 = $46,285.72
book value end of year 5 = $42,857.15
<u>double declining balance:</u>
deprecation expense year 1 = 2 x 1/14 x $60,000 = $8,571.43
book value end of year 1 = $51,428.57
deprecation expense year 2 = 2 x 1/14 x $51,428.57 = $7,346.94
book value end of year 2 = $44,081.63
deprecation expense year 3 = 2 x 1/14 x $44,081.63 = $6,297.38
book value end of year 3 = $37,784.25
deprecation expense year 4 = 2 x 1/14 x $37,784.25 = $5,397.75
book value end of year 4 = $32,386.50
deprecation expense year 5 = 2 x 1/14 x $32,386.50 = $4,626.64
book value end of year 5 = $27,759.86
<u>sum of digits:</u>
depreciable value = $60,000 - $12,000 = $48,000
total sum of digits = 120 years
deprecation expense year 1 = $48,000 x 15/120 = $6,000
book value end of year 1 = $54,000
deprecation expense year 2 = $48,000 x 14/120 = $5,600
book value end of year 2 = $48,400
deprecation expense year 3 = $48,000 x 13/120 = $5,200
book value end of year 3 = $43,200
deprecation expense year 4 = $48,000 x 12/120 = $4,800
book value end of year 4 = $38,400
deprecation expense year 5 = $48,000 x 11/120 = $4,400
book value end of year 5 = $34,000
