Question

on september 30, 2024, bricker enterprises purchased a machine for $203,000. the estimated service life is 10 years with a $19,000 residual value. the company records partial-year depreciation based on the number of months in service. depreciation (to the nearest dollar) for 2024, using sum-of-the-years'-digits method, would be:

Answer 1

The depreciation for 2024, using the sum-of-the-years'-digits method, would be $10,054.

Step-by-step explanation:

The sum-of-the-years'-digits (SYD) method is a depreciation method that assigns more depreciation to earlier years and less to later years. To calculate the depreciation for 2024, we need to determine the depreciation rate for each year of the machine's estimated service life.

First, we calculate the total depreciation base by subtracting the residual value from the initial cost: $203,000 - $19,000 = $184,000.

Next, we calculate the sum of the digits: 10 + 9 + 8 + ... + 2 + 1 = 55.

To calculate the depreciation for 2024, we divide the remaining months in the year (3 months) by the sum of the digits and multiply it by the total depreciation base: (3/55) x $184,000 = $10,054.

Therefore, the depreciation for 2024, using the sum-of-the-years'-digits method, would be $10,054.