Normal ABE 351: Ag Finance Depreciation Methods Ch07: Noncurrent Assets Calculate annual depreciation expenses for the following farm equipment using Straight-line depreciation (SLD), Double-Declining Balance depreciation (DDD) methods, and MACRS. For MACRS, use half year convention. An asset costing $150,000 has an estimated useful life of 5 years with a salvage value of $15,000. In an Excel file, calculate the annual depreciation expense throughout the life of the asset using all three methods. You are free to use a formula if you wish to Here are the links to IRS Publication 225 and 946. [click on the hyperlinked number] Calculate the rent under the following scenarios. A. Cash rent equals a certain percentage of the gross crop returns with a guaranteed base rent. (similar to Example 1 of the reading material). (i) Crop - corn. Base rent = $200 per acre. Percent of gross crop returns - 40% Farmer's yield = 200 Bu per acre and an average price of $3.15 per Bu. Crop - soybean. Base rent = $230 per acre. Percent of gross crop returns = 32% Farmer's yield = 72 Bu per acre and an average price of $9.31 per Bu. B. Cash rent based on a guaranteed base rent and a bonus depending on relative yield (ratio) and relative price (ratio) (similar to Example 21 (0) Crop = corn. Base rent - $230 per acre. Base yield = 190 Bu per acre. Base price = 3.25 per Bu. Farmer's yield - 200 Bu per acre and an average price of $3.15 per Bu. Crop = soybean. Base rent - $200 per acre. Base yield = 58 Bu per acre. Base price = 9.15 per Bu Farmer's yield = 65 Bu per acre and an average price of $9.25 per Bu. C. Cash rent based on a base rent and a bonus trieger. Bonus payment of 40% of revenues over the trigger. (similar to Example 31 (0) Crop - corn Base rent = $180 per acre. Bonus trigger is $715 per acre ($190 base rent plus 525 of nonland costs). Farmer's yield = 210 Bu per acre. Average price - 3.50 per Bu. Crop - soybean. Base rent = $200 per acre Bonus trigger is $615 per acre ($200 base rent plus 415 of nonland costs). Farmer's yield = 62 Bu per acre and an average price of $9.25 per Bu. IN