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    Maserati Corporation depreciation expense under the activity

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    Maserati Corporation purchased a new machine for its assembly process on August 1, 2010. The cost of this machine was $150,000. The company estimated that the machine would have a salvage value of $24,000 at the end of its service life. Its life is estimated at 5 years and its working hours are estimated at 21,000 hours. Year-end is December 31. Compute the depreciation expense under the activity method for 2010, assuming that machine usage was 800 hours.

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    Solution Summary

    The process is shown for you in excel. This is now a template for other similar problems (insert numbers in cells and answer will update).