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Even if your number answers are different please still put the details and steps you did. WindPower Inc designs and commissions the manufacture of a
Even if your number answers are different please still put the details and steps you did.
WindPower Inc designs and commissions the manufacture of a wind powered inverter-based constant voltage generator for research and experimentation with low-rated, highly variable, wind fields as a form of alternative energy. The unit cost $35,000 plus $3,000 for shipping and installation. After 3 years, WindPower had no further use for the experimental unit and was able t sell it for $2,000, less $500 for removal. WindPower had depreciated the generator cost over the 3 years with an estimated life of 5 years and a terminal book value of $1,000. All of the following parts relate to financial reporting, not computing income taxes. a. What is the total investment cost (basis) for this generator? ANSWER $38,000.00 b. What is the net market value actually received after three years? ANSWER $1,500.00 C. By what amount did the book value differ from the net market value at the end of 3 years if the following depreciation method was used? i. Straight-line depreciation. . Declining balance depreciation using a rate that ensures the book value equals the salvage value. iii. Double declining balance depreciation. iv. Double declining balance switching to straight line depreciation. ANSWER i= $ 14,300.00 ii= $ 2,781.79 iii = $6,708.00 iv = $ 6,708.00Step by Step Solution
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