Listed below is information for each of the three machines at Stark Enterprises. Adjustments are recorded yearly. Assume a September 30th year end.
Machine
Acquired
Cost
Residual Value
Useful Life
(in years)
Depreciation Method
1
March 1, 2018
102000
10000
5
2
May 31, 2019
85000
5000
4
Double Diminishing Balance
Units of Production
3
June 1, 2020
40000
4000
4
Straight Line
For the units of production method, total machine hours are 20,000. Actual hours of use in the first 2 years were 1.700 hours in 2019 and 4,800 hours in 2020
Required:
1. Calculate the accumulated depreciation and carrying amount on each machine for September 30, 2020. Round the calculations and your answer to the nearest
dollar. Place your answer in the table below:
Machine 1
Machine 2
Accumulated Depreciation
Carrying Amount
Machine 3
2. Assume Machine 1 was sold on Feb. 1, 2021 for $25,000, What is the gain/loss from this sale? Round the calculations and your answer to the nearest dollar.
Use brackets to indicate a negative number. Do not write gain or loss in your response.