On March 1, 2012, Jim’s Motor Parts purchased a new machine. The machine has an expected life of 5 years. The machine cost $500,000. Shipping, installation, and setup was an additional $50,000. At the end of the useful life, Bryce, chief accountant for Jim’s Motor Parts, expects to dispose of the machine for $100,000. He further anticipates total machine hours of 100,000 over the useful life.

(a) Assuming use of the straight-line depreciation method, prepare a depreciation schedule.

(b) Assuming use of the units-of-output depreciation method, calculate depreciation expense and accumulated depreciation for year. Actual usage, in machine hours, was 15,000 (2012), 20,000 (2013), 25,000 (2014), 25,000 (2015), 10,000 (2016), and 5,000 (2017).

(c) Assuming use of the double-declining balance depreciation method, prepare a depreciation schedule.

(d) Assuming use of the straight-line method, prepare revised depreciation calculations if the useful life estimate was revised at the beginning of 2014 (prior to the depreciation entry), to anticipate a revised useful life of 6 years. The revised useful life was accompanied by a change in estimated salvage value to $60,000. Report the amount of depreciation expense and accumulated depreciation for each year.