Youngblood Shipbuilding Yard just purchased $1 million in capital equipment for ship repairing functions on dry-docked ships. Estimated salvage is $150,000 for any year after 5 years of use. Com­pare the depreciation and book value for year 3 for each of the following depreciation methods:

(a) GDS MACRS, where a recovery period of 10 years is allowed.
(b) Double declining balance, with a recovery pe­riod of 15 years.
(c) ADS straight line as an alternative to MACRS, with a recovery period of 15 years.


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