Question $3(45$p$)$

Gazima$$usa$,$ Inc., purchased a new machine on September $1$ of the current year at a cost of $$115,000.$ The machine's estimated useful life at the time of the purchase was five years, and its residual value was $$10,000.$

Instructions

a$.$ Prepare a complete depreciation schedule, beginning with the beginning year, under the

a$)$ Straight$-$line $($assume that the Fractional method is used$)$

b$)200$ percent declining$-$balance $($assume that the half$-$year convention is used$)$

c$)$ Assume that Swanson & Hiller sells the machine on December $31$ of the fourth year for $$30,000$ cash. Compute the resulting gain or loss from this sale under each of the depreciation methods used in part a and $b.$