ABC Company purchased a piece of equipment on May 1, 2004 for \$27,000. The equipment was assigned a \$3,000 salvage value and an 8-year life. It is estimated that the equipment will produce a total of

ABC Company purchased a piece of equipment on May 1, 2004 for \$27,000. The equipment was assigned a \$3,000 salvage value and an 8-year life. It is estimated that the equipment will produce a total of 50,000 units over its life.

Calculate the book value of the equipment at December 31, 2005 assuming ABC Company will depreciate the equipment using the units-of-production method. Assume the equipment was used to produce 6,500 units during 2004 and 7,200 units during 2005.

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On June 1, 2002, Duncan Inc. purchased equipment for \$65,000. The equipment had an estimated

useful life of 10 years and an estimated salvage value of \$5,000.

Assume the company employs the straight-line method of depreciation. Calculate the amount of

accumulated depreciation on the equipment shown in the balance sheet at December 31, 2006

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XYZ Company purchased a new machine on January 1, 2003 for \$120,000. The machine had an 8-year

life and a \$5,000 salvage value assigned to it.

Calculate the book value of the machine at December 31, 2005 assuming the company will depreciate

the machine using the double-declining balance depreciation method. Do not use decimals in your

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XYZ Company purchased a new machine on January 1, 2003 for \$122,800. The machine had a 7-year

life and a \$5,200 salvage value assigned to it. The machine is being depreciated using the

sum-of-the-years’-digits depreciation method.

If XYZ Company sold the machine on December 31, 2005 for \$30,000, calculate the loss on the

sale recorded by XYZ Company. Do not use a minus sign or decimals in your answer. Additionally,