On June 12, 2020, 3 different companies purchase identical lathing machines to use in manufacturing their...

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On June 12, 2020, 3 different companies purchase identical lathing machines to use in manufacturing their products. Each company purchases the machine for $87,000. Information regarding each company's policy for depreciating the machine is as follows: Depreciation method Estimated useful life Residual value Sask Corporation Straight-line 8 years $10,400 Limerick Ltd. Double-declining balance 10 years $10,050 Uni Co. Units-of-production 18,750 units $12,000 Each company follows IFRS and has a fiscal year end of December 31. Each company uses the nearest whole month method, if applicable, for recording depreciation in the year of purchase. REQUIRED: 1. Calculate depreciation expense for the machine for each of the above companies for the years ended December 31, 2020 and 2021. Assume that during the year 2020, College Co. manufactures 4,002 units with the new machine, and 4,802 units in 2021. Round dollar and unit calculations to the nearest whole number. 2. Prepare the depreciation journal entry for each company for December 31, 2020. On June 12, 2020, 3 different companies purchase identical lathing machines to use in manufacturing their products. Each company purchases the machine for $87,000. Information regarding each company's policy for depreciating the machine is as follows: Depreciation method Estimated useful life Residual value Sask Corporation Straight-line 8 years $10,400 Limerick Ltd. Double-declining balance 10 years $10,050 Uni Co. Units-of-production 18,750 units $12,000 Each company follows IFRS and has a fiscal year end of December 31. Each company uses the nearest whole month method, if applicable, for recording depreciation in the year of purchase. REQUIRED: 1. Calculate depreciation expense for the machine for each of the above companies for the years ended December 31, 2020 and 2021. Assume that during the year 2020, College Co. manufactures 4,002 units with the new machine, and 4,802 units in 2021. Round dollar and unit calculations to the nearest whole number. 2. Prepare the depreciation journal entry for each company for December 31, 2020.

Answer rating: 100% (QA)

1 using the nearest whole month method 12th june is near to 1st june than 30th june we take 1st june ... View the full answer