Answer:
Explanation:
(A)
What motivation theory applies to the workers at Aramark?
The workers should be motivated with payments for the return of valuables forgotten in the aircraft.
(B)
To motivate them, offer them a salary increase
(C)
Some possible barriers to the effectiveness of these motivation ideas are gluttony (depending on individual worker), a period of stiff or falling profit (which will hinder the smooth running of the new benefit policies), change of management.
(D)
What could you do, to overcome them?
To ensure that workers do not still steal forgotten valuables, place a check or supervision on them.
To ensure the profit level is maintained or increased, make sure the workers do not relent in their duties. Sometimes, more benefits make workers relax more.
The potential benefits lost by taking a specific action when two or more alternative choices are available is known as a(n):
Answer:
Opportunity costs
Explanation:
The potential benefits lost by taking a specific action when two or more alternative choices are available is known as opportunity costs.
Opportunity cost has to do with losing other alternatives by chosing to go with one alternative. Hence it is also called foregone alternative. It has to do with making a decision or choice to give up something in order to get something else which may be of more value.
A machine costs $600000 and is expected to yield an after tax net income of $23000 each year. Managment predicts this machine has a 10 year service life and a $120000 salvage value, and it uses straight line depreciation. Compute this machine's accounting rate of return
Answer:
6.39%
Explanation:
The cost of the machine is $600,000
The net income is $23,000
The management predict a that it has a 10 years service life
The salvage value is $120,000
The first step is to calculate the average investment
Average investment= (Cost of machine+Salvage value)/2
= $600,000+$120,000/2
= $720,000/2
= $360,000
Therefore, the accounting rate of return can be calculated as follows
= Annual net income/Average investment
= $23,000/$360,000
= 0.0639×100
= 6.39%
Hence the accounting rate of return is 6.39%
A 30 year $1,000 par 4 3/4% Treasury Bond is quoted at 95-11 - 95-15. The note pays interest on Jan 1st and Jul 1st. A customer buys 1 bond at the ask price. What is the current yield, disregarding commissions
Answer:
4.98%
Explanation:
Calculation for the current yield
First step
Since the the bond was purchased at 95 +15/32nds this means that we have to find the bond percentage.
Calculated as
Bond Percentage = 95 + 15/32nds
Bond percentage =95.46875%
Second step is to multiply the bond percentage by $1,000
95.46875% *$1,000
= $954.6875
The last step is to find the current yield
Current yield=$47.50 /$954.6875
Current yield = 4.98%
Therefore the current yield will be 4.98%
Kunkel Company makes two products and uses a conventional costing system in which a single plantwide predetermined overhead rate is computed based on direct labor-hours. Data for the two products for the upcoming year follow:
Mercon Wurcon
Direct materials cost per unit $ 9.00 $ 7.00
Direct labor cost per unit $15.00 $ 17.00
Direct labor-hours per unit 0.40 4.80
Number of units produced 4,000 8,000
These products are customized to some degree for specific customers.
Required:
1. The company's manufacturing overhead costs for the year are expected to be $1,600,000. Using the company's conventional costing system, compute the unit product costs for the two products.
2. Management is considering an activity-based costing system in which half of the overhead would continue to be allocated on the basis of direct labor-hours and half would be allocated on the basis of engineering design time. This time is expected to be distributed as follows during the upcoming year:
Mercon Wurcon Total
Engineering design time (in hours) 8,000 8,000 16,000
Compute the unit product costs for the two products using the proposed ABC system.
Answer:
Instructions are below.
Explanation:
Giving the following information:
Mercon Wurcon
Direct materials cost per unit $ 9.00 $ 7.00
Direct labor cost per unit $15.00 $ 17.00
Direct labor-hours per unit 0.40 4.80
Number of units produced 4,000 8,000
A. First, we need to calculate the predetermined overhead rate:
Total direct labor hours= 0.4*4,000 + 4.8*8,000= 40,000
Overhead= 1,600,000
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 1,600,000/40,000
Predetermined manufacturing overhead rate= $40 per direct labor hour
Now, we can determine the unitary product cost.
Mercon= 9 + 15 + 40*0.4= $37
Wurcon= 7 + 17 + 4.8*40= $216
B.
Mercon Wurcon Total
Engineering design time (in hours) 8,000 8,000 16,000
Now, we have two different allocation rates:
Direct-labor hours= 800,000/40,000= $20 per direct labor hour
Engineer desing= 800,000/16,000= $50 per engineer desing hour
Finally, we can determine the unitary product cost:
Engineer design per unit:
Mercon= 8,000/4,000= 2
Wurcon= 8,000/8,000= 1
Mercon= 9 + 15 + (20*0.4 + 50*2) = $132
Wurcon= 7 + 17 + (20*4.8 + 50*1)= $170
Suppose the price level and value of the U.S. Dollar in year 1 are 1 and $1, respectively. Instructions: Round your answers to 2 decimal places. a. If the price level rises to 1.55 in year 2, what is the new value of the dollar
Answer: $0.65
Explanation:
The Price Level and the value of a currency are inversely related because inflation erodes the value of the currency. Therefore if the price level increases, the value of the currency drops. The reverse is true.
The formula therefore is is;
New Value = [tex]\frac{1}{Price Level}[/tex]
New Value = [tex]\frac{1}{1.55}[/tex]
New Value = 0.6452
New Value = $0.65
you have just deposited $11000 in to an account that promises to pay you an annual interest rate of 6.5 percent each year for the next 6 years. You will leave the money invested in the account and 10 years from today. you need to have $26300 in the account. What annual interest rate must you earn over the last 4 years to accomplish this goal
Answer:
Over the last 4 years to accomplish this goal the annual interest rate must be 13.14 %.
Explanation:
First find the Future value (FV) of $11,000 at the end of the 6th year as follows :
PV = -$11,000
r = 6.50%
p/yr = 1
n = 6
Pmt = $0
FV = ?
Using a financial calculator, the Future Value (FV) is $16,050.57
Therefore, the amount invested will amount to $16,050.57 in 6 year.
Next we then calculate the interest rate that will give us $26300 in the next four years (remainder of the 10 years)
PV = -$16,050.57
FV = $26,300
P/yr = 1
n = 4
Pmt = $0
r = ?
Using a financial calculator, the Interest rate (r) is 13.14 %
Conclusion :
Over the last 4 years to accomplish this goal the annual interest rate must be 13.14 %.
Suppose that the quantity of apples sold increases by 30 percent after the price of pears increases by 15 percent. What is the coefficient of cross elasticity of demand
"An economy is based on three sectorsdashagriculture, manufacturing, and services. For each unit of output, agriculture requires inputs of 0.20 unit from agriculture, 0.40 unit from manufacturing, and 0.20 unit from services. For each unit of output, manufacturing requires inputs of 0.30 unit from agriculture, 0.20 unit from manufacturing, and 0.20 unit from services. For each unit of output, services requires 0.20 unit from agriculture, 0.30 unit from manufacturing, and 0.30 unit from services. Determine the production levels needed to satisfy a final demand of 0 units for agriculture, 40 units for manufacturing, and 0 units for services. The production level needed from the agricultural sector is 40.00 units."
Answer:
Required Production to fullfil a Demand for 40 industry units
Agriculture 54.4
Industry 83.2
Services 51.2
Explanation:
Input Agricuilture Industrial Service
Agriculture 0.2 0.3 0.2
Industrial 0.4 0.2 0.3
Service 0.2 0.2 0.3
We require X input to generate a demand of 0 agriculture 40 industry and 0 services
The previous matrix will be the input we solve for the output
Output Agricuilture Industrial Service
Agriculture 0.8 -0.7 -0.8
Industrial -0.6 0.8 -0.7
Service -0.8 -0.8 0.7
We now reverse the matrix using excel:
Output Agricuilture Industrial Service
Agriculture 2 1.36 0.96
Industrial 1 2.08 0.88
Service 1 1.28 2.08
Now we multiply this by our desired outcome of
0
40
0
Agriculture 54.4
Industry 83.2
Services 51.2
g Profit maximazation for a monopolist and a perfect competitor occurs where marginal revenue equals marginal cost. At this profit-maximizing output, the monopolist will charge a price ________ marginal revenue and a perfect competitor will charge a price ________ marginal revenue.
Answer: Higher than; Equal to
Explanation:
Profit maximazation for a monopolist and a perfect competitor occurs where marginal revenue equals marginal cost.
The Marginal Revenue curves are different for either of them though and this impacts what price they sell at. This is because the price the good will be sold at depends on where the maximising output touches the demand curve.
The Monopolist has a Marginal Revenue curve that is lower than the Demand Curve. Therefore the point where Marginal Revenue and Marginal Cost intersect, will not be on the demand curve but lower than it. The price charged will therefore be the point where the maximising output touches the Demand Curve.
The Perfectly Competitive Firm however is in a market where Price is equal to the Demand curve and equal to the Marginal Revenue curve as well. The point where the Marginal Cost intersects with Marginal Revenue will also be the point where the maximising output touches the Demand curve so the price will be the same as the Marginal Revenue.
Consider a risky portfolio. The end-of-year cash flow derived from the portfolio will be either $70,000 or $200,000 with equal probabilities of .5. The alternative risk-free investment in T-bills pays 6% per year. a. If you require a risk premium of 8%, how much will you be willing to pay for the portfolio?
Answer:
$118,421
Explanation:
first we must calculate the expected value of the risky portfolio = ($70,000 x 0.5) + ($200,000 x 0.5) = $135,000
since your risk premium is 8% and the risk free rate is 6%m then you should discount the expected value by 8% + 6% = 14% to determine its current market price
= $135,000 / (1 + 14%) = $118,421
Wolverine Company financial statements included the effects of these errors: Reported Net Income for Year 1 was $20,000. Reported Net Income for Year 2 was $18,000. Indicate the error in 12/31/2 Retained Earnings:
Answer:
Net income year 2 = $21,300
Explanation:
I looked for the missing information and found this:
Year Depreciation overstated Prepaid expense omitted
1 $2,500 $2,000
2 $4,000 $2,700
If your question doesn't include the same values, just adjust the answer.
Year 2's net income = net income (year 2) + overstated depreciation (year 2) + omitted prepaid expenses (year 1) - omitted prepaid expenses (year 2) = $18,000 + $4,000 + $2,000 - $2,700 = $21,300
Abburi Company's manufacturing overhead is 55% of its total conversion costs. If direct labor is $45,900 and if direct materials are $27,200, the manufacturing overhead is:
Answer:
Manufacturing Overheads = $56100
Explanation:
The conversion cost defined simply is the cost involved in turning the raw material or direct material into the finished products. Conversion cost is calculated by adding the direct labor cost and the manufacturing overhead cost.
Conversion cost = Direct labor + Manufacturing overheads
As we know that the manufacturing overhead is 55% of conversion cost, then the direct labor cost is 45% of conversion cost.
If 45% of conversion cost is $45900, then the total conversion cost will be,
Conversion cost = 45900 * 100/45 = $102000
Manufacturing Overheads = 102000 - 45900 = $56100
Justin hires Miguel to sell his baseball glove for $560. As part of their contract, Justin will pay him $100 to conduct the sale. Justin is a _______________________. Group of answer choices
Answer: Factee
Explanation:
This is a factorage transaction in which Justin will pay Miguel to act as an intermediary who will sell the baseball glove and receive a commission. That commission is known as a Factorage.
In a Factorage transaction, the intermediary being paid to sell the product is considered to be the Factor and the person who will pay for the product to be sold is the Factee. Justin in this scenario is paying for the baseball glove to be sold and so is the Factee.
Sarah, the controller of a large beverage supplier, supervises two employees. Her boss, Vladimir, instructs her to increase the company's inventory balance for an amount that is material to the financial statements by crediting several small "miscellaneous" expense accounts. She does not understand why he wants her to make these entries but immediately directs one of her staff to make them because she has been instructed to do so. Which of the following statements best describes Sarah's actions?
Answer:
Sarah failed to evaluate a potential ethical issue
Explanation:
According to the given scenario, Ethical concerns occur as workers face pressure from their employers to inflate profits or expenditures that include manipulating financial statements. Workers should be morally responsible and not participate in any dishonest behavior that modify the financial statements.
So, the correct answer is Sarah failed to evaluate a potential ethical issue .
A monopoly's cost function is CQ and its the demand for its product is pQ where Q is output, p is price, and C is the total cost of production. Determine the profit-maximizingLOADING... price and output for a monopoly.
Answer:
The answer is "70 units".
Explanation:
In the given question some equation is missing which can be defined as follows:
[tex]C = 1.5Q^2+40Q\\\\P=320-0.5Q[/tex]
Monopolistic functions are used where Marginal Profit = Marginal Cost where marginal revenue and marginal cost stand for the MR and MC.
Finding the value of MR :
[tex]\ MR = \frac{\partial TR}{\partial Q} \\\\[/tex]
[tex]= \frac{\partial PQ}{\partial Q} \\\\= \frac{\partial (320-0.5Q)Q}{\partial Q}[/tex]
[tex]= \frac{\partial (320Q -0.5Q^2)}{\partial Q}\\\\ = \frac{\partial Q (320 -0.5Q)}{\partial Q}\\\\ \ by \ solving \ we \ get \\\\ = 320 - Q...(1)[/tex]
Calculating the value of the MC:
[tex]MC = \frac{\partial TC}{\partial Q} \\[/tex]
[tex]=\frac{\partial (1.5Q^2 + 40Q)}{\partial Q} \\\\=\frac{\partial Q (1.5Q + 40)}{\partial Q}\\\\ \ by \ solve \ value \\\\ = 3Q + 40....(2)[/tex]
compare the above equation (i) and (ii):
[tex]\to 320 -Q = 3Q+40\\\\\to 320 -40 = 3Q+ Q\\\\\to 280 = 4Q\\\\\to 4Q =280 \\\\\to Q= \frac{280}{4}\\\\\to Q= 70 \\[/tex]
Sudoku Company issues 7,000 shares of $7 par value common stock in exchange for land and a building. The land is valued at $45,000 and the building at $85,000. Prepare the journal entry to record issuance of the stock in exchange for the land and building.
Answer:
The journal entry to record this exchange is :
Land $45,000 (debit)
Buildings $85,000 (debit)
Common Stocks $49,000 (credit)
Share Premium $81,000 (credit)
Explanation:
The price of Common Stock is equivalent to the price required to settle the Market Cost of Land and Buildings.
Also note that the Common Stocks have a par vale of $7, this means that any amount paid in excess of the par value is accounted in the Share Premium Reserve.
The journal entry to record this exchange is :
Land $45,000 (debit)
Buildings $85,000 (debit)
Common Stocks $49,000 (credit)
Share Premium $81,000 (credit)
Land $45,000
Building $85,000
To Common stock $49,000 (7,000 shares × $7)
To Premium on issue of common stock 81,000
(Being recording of the issuance of the stock in exchange for the land and building)
Learn more: brainly.com/question/17429689
When a standalone organization is created and owned by two or more parent companies together, the strategic alliance is referred to as a(n) _____.
Answer:
Joint venture
Explanation:
A joint venture is one where two or more parties agree to pool their resources together to accomplish a particular goal.
Each participant shares in the profit, loss, and cost associated with the business.
However the venture an entity that is independent of the participant's other business interest.
So when a standalone organization is created and owned by two or more parent companies together, it is called a joint venture
Department Y started 675 units during the accounting period. They had a beginning balance in goods in process inventory of 225 units and an ending balance of 150 units. _____ units were completed and transferred out.
a. 750
b. 620
c. 650
d. None of above
Answer:
a. 750
Explanation:
units completed and transferred out = beginning work in process + units started - ending work in progress = 225 units + 675 units - 150 units = 750 units
The number of units completed and transferred out refer to the total number of finished units during a certain period and their cost is referred to as cost of goods manufactured.
At the beginning of year 1, Looby Corp. purchases equipment for $100,000. The equipment has a residual value of $20,000 and an expected useful life of 10 years. What is accumulated depreciation at the end of year 2 using straight-line depreciation
Answer:
Accumulated Depreciation at the end of year = $16,000
Explanation:
Under the straight line method of depreciation, the cost of an asset less the salvage value is spread equally over the expected useful life.
An equal amount is charged as annual depreciation over the life of the asset. The annual depreciation is calculated as follows:
Annual depreciation:
= (cost of assets - salvage value)/ Estimated useful life
Cost - 100,000
Residual value = 20,000
Estimated useful life = 10 years
Annual depreciation = (100,000- 20,000)/10 =8,000
Annual depreciation = 8,000
Accumulated Depreciation for 2 years = Annual depreciation× number of years
= 8,000× 2 = 16,000
Accumulated Depreciation for 2 years = $16,000
Indus Corporation pays $100,000 for the trademark rights to a line of soda equipment. After several years, sales for this line of soda equipment are disappointing, and the company estimates the total future cash flows from sales will be only $110,000. The estimated fair value of the trademark is now $60,000. What is the amount of the impairment loss to be recorded
Answer:
impairment loss = $40,000
Explanation:
In accounting, impairment loss refers to the decrease of an asset's carrying value. In order to calculate the impairment loss, you need to subtract the current market value of the asset from its original carrying value.
impairment loss = carrying value - current market value = $100,000 - $60,000 = $40,000
Cooley Company's stock has a beta of 1.40, the risk-free rate is 25%, and the market risk premium is 5.50%. What is the firm's required rate of return
Answer: 12.2%
Explanation:
Given the variables available, the required rate of return can be computed using the Capital Asset Pricing Model with the formula;
Required Return = Risk-free rate + beta ( Market risk premium)
Required return = 4.25% + 1.4 * 5.5%
Required return = 4.25% + 7.7%
Required return = 12.2%
Note; The actual question says the Risk-free rate is 4.25%.
The marketing department of a reputable firm wants to improve strategic decision making, track the actions of other players in the market, and provide early warning of opportunities and threats. Which of the following would help the firm achieve its objectives?
A) Data warehousing
B) strategic planning competitive marketing intelligence
D) customer relationship management
E) ethnographic research
Answer:
The answer is C. competitive marketing intelligence
Explanation:
Competitive marketing intelligence may be a powerful research-based method employed by a company to collect, analyze, and use information collected on competitors, economic conditions, customers etc to a achieve business's competitive advantage.
The information-gathering analysis process can help a corporation develop its strategy or identify competitive gaps. It identifies threats and opportunities within the business
A large open economy has desired national saving of Sd = 1200 + 1000rw, and desired national investment of Id = 1000 - 500rw. The foreign economy has desired national saving of = 1300 + 1000rw, and desired national investment of = 1800 - 500rw. The equilibrium world real interest rate equal to:________.
Answer: 10%
Explanation:
The Equilibrium real interest rate would be the interest rate that equates the Desired savings to the desired investment for both the National and foreign economy.
Desired national saving + Foreign desired national saving = Desired national investment + Foreign desired national investment
1,200 + 1,000rw + 1,300 + 1,000rw = (1,000 - 500rw) + (1,800 - 500rw)
2,500 + 2,000rw = 2,800 - 1,000rw
2,000rw + 1,000rw = 2,800 - 2,500
3,000rw = 300
rw = 0.1
rw = 10%
Crane Company has gathered the following information.
Units in beginning work in process 0
Units started into production37,300
Units in ending work in process8,200
Percent complete in ending work in process:
Conversion costs40%
Materials100%
Costs incurred:
Direct materials$78,330
Direct labor$66,500
Overhead$105,114
1. Compute equivalent units of production for materials and for conversion costs.
Materials
Conversion Costs
The equivalent units of production
2. Determine the unit costs of production. (Round unit costs to 2 decimal places, e.g. 2.25.)
Materials
Conversion Costs
Unit costs
$
$
3. Show the assignment of costs to units transferred out and in process.
Units transferred out $
Units in ending work in process
Answer:
1. Compute equivalent units of production for materials and for conversion costs
Equivalent units of Materials: (Units in Beginning Work in process + Units started into production - Units in ending work in process) + Units in ending work in process
= (0 + 37,300 - 8,200) + 8,200
= 37,300
Equivalent units of conversion costs : (Units in Beginning Work in process + Units started into production - Units in ending work in process) + (Units in ending work in process * 40%)
= (0 + 37,300 - 8,200) + (8,200 * 40%)
=29,100 + 3,280
= 32,380
2. Determine the unit costs of production
Unit costs of materials = Direct materials / Equivalent units of Materials
= $78,330 / 37,300
= $2.1
Unit costs of conversion costs = (Direct labor + Overhead) / Equivalent units of conversion costs
= ($66,500 + $105,114) / 32,380
= $171,614 / 32,380
= $5.3
3. Show the assignment of costs to units transferred out and in process
Units ending work in process = Materials + Conversion costs
where, Materials = 8,200 * $2.1 = $8,202
Conversion costs = 3,281 * $5.3 = $17,389
( 8,200 * 40%)
Units ending work in process = $8,202 + $17,389
= $25,591
The _____ was established by Congress to encourage American firms to focus on quality improvement in order to improve their global competitiveness.
Answer:
The correct answer is: Baldridge Performance Excellence Program.
Explanation:
To begin with, the "Baldridge Performance Excellence Program" is the name given to the program that was established by the United States of America in order to encourage the companies of the country to improve their performance regarding the economy and the globalization that was happening at the time the program was created. It receives its name from the ex secretary of commerce Malcom Baldridge and the award gives to the company selected the recognition of having performance excellence in the its field
calculate the net present value of a business deal that cost $2500 today and will return $1500 at the end of this year. use interest rate of 13%
Answer:
NPV= -$1,172.57
Explanation:
Giving the following information:
Initial investment= $2,500
Cash flow= $1,500
Discount rate= 13%
To calculate the net present value (NPV), we need to use the following formula:
NPV= -Io + ∑[Cf/(1+i)^n]
NPV= -2,500 + (1,500/1.13)
NPV= -1,172.57
Bogart Company is considering two alternatives. Alternative A will have revenues of $147,400 and costs of $103,400. Alternative B will have revenues of $188,200 and costs of $121,600. Compare Alternative A to Alternative B showing incremental revenues, costs, and net income.
Answer:
B is better than A
Explanation:
Here, we want to compare “A” to “B”. It means if B’s amount is higher than A’s amount, it should be positive; If B’s amount is lower than A’s amount, it should be negative.
Net income for each alternative = Revenues – Costs
Since the net income is positive, B is better than A.
Please check attachment for for actual tabular calculations
a. Equipment with a book value of $79500 and an original cost of $169000 was sold at a loss of $33000.
b. Paid $106000 cash for a new truck.
c. Sold land costing $310000 for $420000 cash yielding a gainof $11000.
d. Long term investments in stock were sold for $95600 cash yielding a gain of $17000.
Required:
Use the above information to determine this company's cash flows from investing activities.
Answer:
Cash flow from Investing activities refers to cash transactions related to Fixed Assets as well as transactions related to the ownership of other company securities.
Cash-flow from Investing Activities
Sale of equipment (79,500 - 33,000).......................... $46,500
Purchase of New Truck ................................................... ($106,000)
Sale of Land.........................................................................$420,000
Sale of Long-term investments.......................................$95,600
Net cash provided by investing activities ...................$456,100
In terms of the global value system, when Kodak shifted manufacturing to China, what position did China then take in the system, relative to the U.S.
Answer: b. Upstream
Explanation:
The Upstream part of a company's value chain is the part closest to the suppliers and the raw materials they supply to the firm while the downstream relates to how the goods are distributed and sold after produced.
As such, the firm's manufacturing plants are closer to its Upstream value chain portion. When Kodak therefore shifted manufacturing to China, it made China more upstream than the United States as China now dealt more with Kodak suppliers and inputs than the US, who were now more downstream as the consumers.
On January 1, 2016, the Excel Delivery Company purchased a delivery van for $33,000. At the end of its five-year service life, it is estimated that the van will be worth $3,000. During the five-year period, the company expects to drive the van 100,000 miles.
Required:
Calculate annual depreciation for the five-year life of the van using each of the following methods. (Do not round intermediate calculations.)
1. Straight line
2. Sum of the years digits
3. Double declining balance
4, Units of production using miles driven as a measure of output and the following actual mileage:
Year Miles
2016 22,000
2017 24,000
2018 15,000
2019 20,000
2020 21,000
Answer:
1. Straight line
years 2016 to 2020 = $6,000
2. Sum of the years digits
2016 = $10,000
2017 = $8,000
2018 = $6,000
2019 = $4,000
2020 = $2,000
3. Double declining balance
2016 = $13,200
2017 = $7,920
2018 = $4,752
2019 = $2,852
2020 = $1,276
4, Units of production using miles driven
2016 = $6,600
2017 = $7,200
2018 = $4,500
2019 = $6,000
2020 = $5,700
Explanation:
purchase cost $33,000
useful life 5 years, salvage value $3,000
expected use 100,000 miles
1. Straight line
($33,000 - $3,000) / 5 = $6,000
2. Sum of the years digits
year 1 = 5/15 x $30,000 = $10,000
year 2 = 4/15 x $30,000 = $8,000
year 3 = 3/15 x $30,000 = $6,000
year 4 = 2/15 x $30,000 = $4,000
year 5 = 1/15 x $30,000 = $2,000
3. Double declining balance
year 1 = 2 x 1/5 x $33,000 = $13,200
year 2 = 2 x 1/5 x $19,800 = $7,920
year 3 = 2 x 1/5 x $11,880 = $4,752
year 4 = 2 x 1/5 x $7,128 = $2,851.20 ≈ $2,852
year 5 = $4,276 - $3,000 = $1,276
4, Units of production using miles driven
depreciation expense per mile = ($33,000 - $3,000) / 100,000 = $0.30
Year Miles
2016 22,000 x $0.30 = $6,600
2017 24,000 x $0.30 = $7,200
2018 15,000 x $0.30 = $4,500
2019 20,000 x $0.30 = $6,000
2020 (21,000 - 2,000) x $0.30 = $5,700