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On April 1, 2019, Sheffield Corp. purchased new machinery for $459000. The machinery has an estimated useful life of five years, and depreciation is computed by the sum-of-the-years'-digits method. The accumulated depreciation on this machinery at March 31, 2021, should be

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hyderali230

Answer:

$275,400

Explanation:

Accumulated depreciation is the amount of depreciation which is accumulated against each years depreciation and carried until the disposal of the asset. This account will be closed on the disposal of the asset with cost of the asset.

Cost of Machinery = $459,000

Useful life = 5 years

In sum of the year method we add all the years and calculate the respective depreciation based on the year of depreciation as follow

Sum of Years = 5 + 4 + 3 + 2 + 1 = 15

As only only 2 years depreciation is accrued and accumulated from April 1, 2019 to March 31, 2021.

Accumulate depreciation = $459,000 x (5+4) / 15 = $275,400

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