Question
Bob bought a new machine that costed $115,000 on Jan 1. It has a useful life of 8 years or 22,000 hours, and $4000 is
Bob bought a new machine that costed $115,000 on Jan 1. It has a useful life of 8 years or 22,000 hours, and $4000 is the residual value. 20% is the capital cost allowance rate. In the first 3 years it'll be used 400 hours annually. In years 3 to 6, production time will double (800). After year 6, the production time will be 750 hours per year.
a) Make an amortization table for double declining balance b) Bob in the past used a units of production method. Now he would like to minimize his tax burden. Which method (straight, double, uop) should he use? Use knowledge and data in your answer.
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