Solution:
Straight-Line Depreciation
Choose Numerator: / Choose Denominator = Annual Depreciation Expense
Cost minus Salvage / Estimated Useful Life (years) = Depreciation Expense
$110,000 / 10 = $11,000
Depreciation Expense
2016 $11,000
2017 $11,000
Sum-of-the-years' digits depreciation
Depreciable Base x Rate per Year = Depreciation Expense
2016 $110,000 x 10/55 = $20,000
2017 $110,000 x 9/55 = $18,000
Depreciation for the Period End of Period
Annual Period Beginning of Period Book Value Depreciation Rate Depreciation Expense Accumulated Depreciation Book Value
2016 $115,000 20% $23,000 $23,000 $92,000
2017 $92,000 20% $18,400 $41,400 $73,600
Depreciation for the Period End of Period
Annual Period Beginning of Period Book Value Depreciation Rate Depreciation Expense Accumulated Depreciation Book Value
2016 $115,000 15% $17,250 $17,250 $97,750
2017 $97,750 15% $14,663 $31,913 $83,087
Select formula for Units of Production Depreciation:
(Cost - Salvage) / Total units of production
Calculate 2016 depreciation expense:
Depreciation per unit rate $0.50
Units produced in 2016 30,000
Depreciation in 2016 $15,000
Calculate 2017 depreciation expense:
Depreciation per unit rate $0.50
Units produced in 2017 25,000
Depreciation in 2017 $12,500
