On January 1,a Machine Costing $260,000 with a Four-Year Life

question 81

Essay

On January 1,a machine costing $260,000 with a four-year life and an estimated $5,000 salvage value was purchased.It was also estimated that the machine would produce 500,000 units during its life.The actual units produced during its first year of operation were 110,000.Determine the amount of depreciation expense for the first year under each of the following assumptions:
a.The company uses the straight-line method of depreciation.
b.The company uses the units-of-production method of depreciation.
c.The company uses the double-declining-balance method of depreciation.

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Definitions:

Aggregate Supply

The total supply of goods and services that firms in an economy plan on selling during a specific time period at prevailing price levels.

Technology Advances

Progress in technology that improves efficiency, creates new products, or enhances the quality of existing products.

Aggregate Supply

The overall volume of goods and services that enterprises in an economy expect to sell within a specific time interval.

Aggregate Demand

The combined quantity of goods and services that is sought in the economy, set at a certain price level for a specific period.