part c & d

Question 4 (22 marks) Part I JoJo Limited ("JoJo") purchased a machinery for its plant on 1 May 2017. The machinery is expected to have a 10-year life and no residual value. The following expenditures were associated with the purchase: Cost of the machinery Freight-in charges Commission fees Legal title fees Sales taxes Essential set-up charges Cost to repair machinery damaged during installation $ 100,000 3,750 6,000 9.250 5,500 1,500 800 JoJo adopts the cost model as its accounting policy in subsequently measuring its property, plant and equipment Required: (a) Determine the cost of the machinery with detailed workings of calculations. (5 marks) 6) Calculate depreciation expense for the years 2017 to 2019 under 200 percent declining- balance method, using the half-year convention Use the below-mentioned table for the calculation from 2017 to 2019: Year Computation Book value Depreciation Expense Accumulated Depreciation (3 marks) (c) Which depreciation method (Straight-line. Double-declining balance or Units of production) JoJo should use if JoJo wants to achieve the following separate objective? (1) Report the highest possible earnings in its financial statements in the first two years. (1 mark) (11) Minimize its taxable income reported to the tax authority in the first three years. (1 mark) (111) Report the lowest reported book value of the machinery at the end of 2017. (1 mark) (d) Assume that JoJo sold the old machinery that was being replaced. The old machinery had originally cost of $30,000. Its book value at the time of the sale was $4.000. Prepare joumal entries to record the sale of the old machinery if it was sold for $3,000 on account. (4 marks)