Assignment Eight Problem One: MATCHA CREATIONS Mei-ling is thinking of buying a van that will be used only for business. The cost of the van is estimated at NT$36,500. Mei-ling would spend an additional NT$2,500 to have the van painted. In addition, she wants the back seat of the van removed so that she will have lots of room to transport her mixer inventory as well as her baking supplies. The cost of taking out the back seat and installing shelving units is estimated at NT$1,500. She expects the van to last about 5 years, and she expects to drive it for 200,000 miles. The amrual cost of vehicle insurance will be NT$2,400. Mei-ling estimates a residual value of NT$7,500. Assume that she will buy the van on August 15, 2018, and it will be ready for use on September 1, 2018. Mei-ling is concerned about the impact of the van's cost on her SOCI and balance sheet. She has come to you for advice on calculating the van's depreciation. Ignore GST. Instructions: (a) Determine the cost of the van. (b) Prepare three depreciation tables for 2018, 2019, and 2020: one for straight-line depreciation (similar to the one in Illustration 9-10), one for double-declining balance depreciation (Illustration 9- 14), and one for turits-ofactivity depreciation (Illustration 9-12). For units-of-activity, Mei-ling estimates she will drive the van as follows: 15,000 miles in 2018; 50,000 miles in 2019; 50,000 miles in 2020; 45,000 miles in 2021; 40,000 miles in 2022. Recall that Matcha Creations has a December 31 year-end. (c) For 2018, which of the three methods would result in the most favourable profit margin ratio? \"Finch would result in the most favourable debt ratio? What is the total impact that each of the three methods of depreciation will have on Mei-ling's total profit from 2018 through 2023? (d) Referring to the ftmdamental qualitative characteristics, which method of depreciation seems most appropriate? Discuss