Answer all 4 parts

a. PROBLEMA Techno Winery, LTD purchased a piece of equipment on January 1, 2015 for $34,000,000. Management estimates that the equipment will have a useful life of eight years and a $4,000,000 salvage value. The depreciation expense recorded for tax purposes is computed using the double-declining balance method of depreciation. The company uses the straight-line method of depreciation for reporting purposes. The company's fiscal year from January 1 to December 31. Calculate the amount of depreciation expense for reporting purposes for the year ending December 31, 2020 (i.e., the 6th full year of depreciation). Then calculate the amount of depreciation expense for tax purposes for the year ending December 31, 2020 (i.e., the 6th full year of depreciation). Use this information to determine the correct answers to the following two (2) questions: 1. Will a deferred tax asset or a deferred tax liability be created for the year ending December 31, 2020 as a result of the depreciation recorded for tax and financial reporting purposes? Deferred tax asset b. Deferred tax liability 2. According to the Double Declining Balance depreciation schedule that Techno Winery, LTD used compute depreciation expense for tax purposes, what was the ending book value of this piece of equipment on December 31, 2017? Record your answer as a dollar amount rounded to zero (0) decimal places, but do not include the dollar sign or any commas. 3. According to the Straight-Line method of depreciation that Techno Winery, LTD used compute depreciation expense for reporting purposes, what was the ending book value of this piece of equipment on December 31, 2019? Record your answer as a dollar amount rounded to zero (0) decimal places, but do not include the dollar sign or any commas. 4. Assuming that the company's tax rate is 21%, what dollar amount (as an absolute value) will be added (if your answer to the prior question was a) or subtracted (if your answer to the prior question was b) to the deferred tax account on the December 31, 2020 balance sheet as a result of the depreciation timing difference? Record your answer as a dollar amount rounded to zero (0) decimal places, but do not include the dollar sign or any commas. 1 a. PROBLEMA Techno Winery, LTD purchased a piece of equipment on January 1, 2015 for $34,000,000. Management estimates that the equipment will have a useful life of eight years and a $4,000,000 salvage value. The depreciation expense recorded for tax purposes is computed using the double-declining balance method of depreciation. The company uses the straight-line method of depreciation for reporting purposes. The company's fiscal year from January 1 to December 31. Calculate the amount of depreciation expense for reporting purposes for the year ending December 31, 2020 (i.e., the 6th full year of depreciation). Then calculate the amount of depreciation expense for tax purposes for the year ending December 31, 2020 (i.e., the 6th full year of depreciation). Use this information to determine the correct answers to the following two (2) questions: 1. Will a deferred tax asset or a deferred tax liability be created for the year ending December 31, 2020 as a result of the depreciation recorded for tax and financial reporting purposes? Deferred tax asset b. Deferred tax liability 2. According to the Double Declining Balance depreciation schedule that Techno Winery, LTD used compute depreciation expense for tax purposes, what was the ending book value of this piece of equipment on December 31, 2017? Record your answer as a dollar amount rounded to zero (0) decimal places, but do not include the dollar sign or any commas. 3. According to the Straight-Line method of depreciation that Techno Winery, LTD used compute depreciation expense for reporting purposes, what was the ending book value of this piece of equipment on December 31, 2019? Record your answer as a dollar amount rounded to zero (0) decimal places, but do not include the dollar sign or any commas. 4. Assuming that the company's tax rate is 21%, what dollar amount (as an absolute value) will be added (if your answer to the prior question was a) or subtracted (if your answer to the prior question was b) to the deferred tax account on the December 31, 2020 balance sheet as a result of the depreciation timing difference? Record your answer as a dollar amount rounded to zero (0) decimal places, but do not include the dollar sign or any commas. 1