Depreciation calculation methods—partial year Freedom Co. purchased a new machine on July 2, 2013, at a total installed cost of $44,000. The machine has an estimated life of five years and an estimated salvage value of $6,000.
a. Calculate the depreciation expense for each year of the asset’s life using:
1. Straight-line depreciation.
2. Double-declining-balance depreciation.
3. 150% declining-balance depreciation.

b. How much depreciation expense should be recorded by Freedom Co. for its fiscal year ended December 31, 2013, under each of the three methods? (Note: The machine will have been used for one-half of its first year of life.)
c. Calculate the accumulated depreciation and net book value of the machine at December 31, 2014, under each of the three methods.

a.

1. $7,600

2. $17,600

3. $13,200

b.

1. $3,800

2. $8,800

3. $6,600

c.

1. $15200

2. $35,200

3. $26,400

Explanation:

1. Straight Line Depreciation Method

$44,000 - $6,000 / 5 years

= $7,600.

2. Double declining- balance Method

100% / 5 years = 20%

20% * 2 = 40%

$44,000 * 40% = $17,600

3. 150% declining- balance Method

150% / 5 years = 30%

$44,000 * 30% = $13,200

b. Because this is for 6 months only the depreciation expense calculated will be divided into 2

1. $7,600 / 2 = $3,800

2. $17,600 / 2 = $8,800

3. $13,200 / 2 = $6,600

c.

1. $7,600 * 2 = $15200

2. $17,600 * 2 = $35,200

3. $13,200 * 2 = $26,400

hi,

henry is an economist and wants to understand the relationship between inflation and consumer spending habits. for his research, he needs the consumer price index for 2014 and the inflation rate. based on the prices of goods given, what will he find to be the cpi and inflation rate for 2014? assume that a consumer’s basket for three consecutive years consists of the following:

you dont privide answer choices.

answer - 15% of a inflatation rate is 15% less in cpi