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Cheetah Copy purchased a new copy machine. The new machine cost $134,000 including installation. The company estimates the equipment will have a residual value of $33,500. Cheetah Copy also estimates it will use the machine for four years or about 8,000 total hours. Actual use per year was as follows:
Year Hours Used
1 2,800
2 2,000
3 2,000
4 3,200
Prepare a depreciation schedule for four years using the activity-based method.

Respuesta :

The depreciation schedule for the machine is:

Year      Depreciation expense

1               $35175

2               $25,125

3               $25,125

4                 $40,200

What is the depreciation expense?

Activity method based on hours worked = (hours worked that year / total hours of the machine) x  (Cost of asset - Salvage value)

Year 1 = (2800 / 8000) x (134,000 - 33500) =$35175

Year 2 = (2000 / 8000) x (134,000 - 33500) =$25,125

Year 3 = (2000 / 8000) x (134,000 - 33500) =$25,125

Year 4 = (3200 / 8000) x (134,000 - 33500) = $40,200

To learn more about depreciation, please check: https://brainly.com/question/15186872

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