Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Having trouble with Part 2, 3 and 5, the Activity Method and the CCA. I can't get the correct steps. P11.3 On June 15, 2017,

image text in transcribedimage text in transcribed

Having trouble with Part 2, 3 and 5, the Activity Method and the CCA. I can't get the correct steps.

P11.3 On June 15, 2017, a second-hand machine was purchased for $77,000. Before being put into service, the equipment was overhauled at a cost of $5,200, and additional costs of $400 for direct material and $800 for direct labour were paid in fine-tuning the controls. The machine has an estimated residual value of $5,000 at the end of its five-year useful life. The machine is expected to operate for 100,000 hours before it will be replaced and is expected to produce 1.2 million units in this time. Operating data for the next six fiscal years are provided below. The company has an October 31 fiscal year end. Year Hours of Operation Units Produced 2017 10,000 110,000 2018 20,000 270,000 2019 20,000 264,000 2020 20,000 310,000 2021 18,000 134,000 2022 12,000 112,000 Instructions a. Calculate the depreciation charges for each fiscal year under each of the following depreciation methods. Where necessary, round depreciation rate per unit to four decimal places. Round final amounts to the nearest dollar. 1. Straight-line method. Pro-rate June 2017 and 2022 to half a month. 2. Activity method: based on output 3. Activity method: based on input 4. Double-declining-balance method. Pro-rate June 2017 to half a month. *5. Taxation CCA, Class 8, 20%

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Elementary Statistics

Authors: Robert R. Johnson, Patricia J. Kuby

11th Edition

978-053873350, 9781133169321, 538733500, 1133169325, 978-0538733502

Students also viewed these Accounting questions