On June 15,201 1, a second-hand machine was purchased for$77,000. Before being put into service, the equipment
Question:
Instructions
(a) Calculate the depreciation charges for each fiscal year under each of the following depreciation methods. Where necessary, round depreciation rate per unit to four decimal places.
1. Straight-line method
2. Activity method: based on output
3. Activity method: based on input
4. Double-declining-balance method
*5. CCA, Class 8, 20%
(b) What is the carrying amount of the machine on the October 31, 2014statementoffinancial position under the first four methods above?
(c) Compare your answers in (b) with the assets tax value at the same date.
(d) What happens if the actual hours of operation or units produced do not correspond to the numbers that were estimated in setting the rate?
Step by Step Answer:
Intermediate Accounting
ISBN: 978-0176509736
10th Canadian Edition, Volume 1
Authors: Donald Kieso, Jerry Weygandt, Terry Warfield, Nicola Young,