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Balls & Bats, Inc. purchased equipment on January 1, 2005 at a cost of $100,000. Estimated useful life is 4 years with a salvage value
Balls & Bats, Inc. purchased equipment on January 1, 2005 at a cost of $100,000. Estimated useful life is 4 years with a salvage value of $10,000.
1. Prepare two different depreciation schedules for the equipment, one using double-declining balance method and the other using the straight line method.
2. Which method would result in the greatest net income for the year ending Dec 31, 2005
3. How would taxes affect management's choice between these two methods for the financial statements?
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