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Can someone please help me with this? On January 1, 2022 Safe Consulting Inc. (SCI) acquired heavy construction equipment for $980,000. SCI expects that the
Can someone please help me with this?
On January 1, 2022 Safe Consulting Inc. (SCI) acquired heavy construction equipment for $980,000. SCI expects that the residual value of the equipment at the end of its 5-year life will be $200,000 and expects that equipment will operate for a total of 90,000 equipment working hours. Actual equipment working hours used for the years ended December 31, 2022 and December 31,2023 are 15,000 and 24,000, respectively. Required: a) Compute the depreciation expense for the years ended December 31, 2022 and December 31, 2023 under the Straight line, Declining Balance at 30\% rate, and the Units of Production methods and insert your answers into the table below. Round to two decimals.(6 Marks)(Need not show calculations) h) b) Assuming that the manager's bonus depends on the total reported income for the first two years (i.e. for 2022 and 2023), which method of depreciation would the manager prefer? Briefly explain why? (2 marks) c) Assume that SCI used the straight-line method of depreciation and decided to sell the equipment on July 1, 2023 for $800,000. Calculate the amount of the gain or loss on the sale of equipment below and state whether it is a gain or loss: (2 Marks)(Need not show calculations) d) Assume that on January 1, 2024, SCI determined that the total useful life of equipment should be 8 years instead of 5 years, and the straight line method of depreciation is used. The residual value is unchanged. Compute the following (2 marks each)(Need not show calculations) 1.The book value of the equipment on January 1, 2024: 2. The depreciation expense for 2024: 3Step by Step Solution
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