A

On April 1, 1993 Ayesha Industries purchased new equipment at a cost of Rs. 325000. Useful life of this equipment was estimated at 5 years, with a residual value of Rs. 25000. For tax purposes, however, this equipment is classified as 3- year property. Required: Compute the annual depreciation expense for each year until this equipment becomes fully depreciated under each depreciation methods listed below (Because you will record depreciation for only a fraction of a year in 1993, depreciation will extend through in all methods except MACRS) and show supporting computations. i. Straight line, with depreciation for fractional years rounded to the nearest whole month. ii. 20%-declining-balance method, with the half-year convention. Limit depreciation in 1998 to an amount which reduces the undepreciated cost to the estimated residual value. iii. Sum-of-the-years-digits, with the half-year convention iv. MACRS accelerated rates for 3-year property

B

The AB & Co produces a chemical which requires processing in three departments. The following is the data to the operation of department III for September, 2008. Units in process at start 50% completed as to Mat. & C.C 5,000 Unit received from Department II 40,000 Unit transferred to finished store room 35,000 Normal units lost 1,000 Balance of units is in process: 100% completed as to material & 50% as to C.C. Cost of beginning inventory P.D.Rs.10, 000 .Mat.Rs.10, 000. CC. Rs.5000 Cost transferred from Department II Rs.30, 000 Cost added: Material Rs. 8,800 Conversion cost Rs.16200 Required: Prepare cost of production report of Department III by Weighted Average