Exercise 5: The following data for equipment purchased by Afrah Company on September 1, 2005 Cost $120,000 Expected salvage value S20000 Estimated useful life years) 5 Estimated useful life(units) 1,000,000 Actual units produced 100,000 units during the first year. Instruction: Instructions: calculate depreciation expenses for first year, and prepare the depreciation schedule for the estimated useful life using a) straight line method b) units of activity method. Solution Depreciation. Schedule: Computation End of Year Units of Depreciable Annual Accumulated Book Year Activities X Cost Dp. Exp, Dep. Value 2005 100000 X 2006 220000 X 2007 200000 X 2008 190000 X 2009 170000 XX 2010 120000