The
Answer to Problem 3P
The depreciation table is shown below
Year |
MACRS |
Cost |
Depreciation |
CumulativeDepreciation |
Book value at the end of the year |
Total |
Explanation of Solution
Given:
Cost of the printing machine is
Time period is
Concept used:
Write the expression to calculate the depreciation value for the printing machine.
Here, the depreciation value is
Write the expression to calculate the book value at the end of the year.
Here, book value at the end of the year is
Calculation:
The given asset comes under MACRS “office equipment” designation. Thus it is considered as a 7 year property. Using MACRS GDS 7 year property table calculate the depreciation and the book value for the printing machine.
Calculate the depreciation for printing machine.
Substitute
Calculate the book value at the end of the year.
Substitute
Calculate the depreciation and book value for all the 7 years and enter them in a table below.
Year |
MACRS |
Cost |
Depreciation |
CumulativeDepreciation |
Book value at the end of the year |
Total |
Conclusion:
The depreciation table is shown below.
Year |
MACRS |
Cost |
Depreciation |
CumulativeDepreciation |
Book value at the end of the year |
Total |
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