On January 1, 2014, Major Purchased a Machine That Had

question 103

Essay

On January 1, 2014, Major purchased a machine that had an estimated useful life of six years and $5,000 residual value. The depreciation on this machine was $2,700 in 2015 using the 150%-declining-balance depreciation method.
Required:
Compute the cost of this machine.

---

Definitions:

Returns To Scale

An economic concept describing how the output of a production process changes as the scale of inputs is increased, divided into increasing, constant, or decreasing returns to scale.

Marginal Products

The additional output resulting from a one-unit increase in the use of a particular input, holding all other inputs constant.

Exponents

Mathematical symbols representing the number of times a number or expression is multiplied by itself.

Production Function

A mathematical representation that defines the relationship between inputs used in production and the output generated from those inputs.