1 Describe the major parts of the income statements and balance sheet of a merchandising concern. Q. 2. On April 15, 2018, ABC Company purchased a new machine for Rs. 55,000 with a residual value of Rs. 5,000, having all estimated useful life of 5 years. It spent Rs. 12,500 on its erection and installation. Compute account under the following depreciation methods: a) Straight-line b) Double declining-balance