On January $1,2016,$ Layman Limited an engineering company bought factory equipment for $ $1,575,000.$ The equipment has a useful life of $5$ years and the residual amount is estimated to be $75,000.$ Layman Limited estimates that the equipment can produce $15,000$ bolts in its first year and $62,500$ units over its life. It estimates that production will decline $1250$ bolts per year over the remaining useful life of the equipment.

Required

i$.$ Determine the depreciation expense using the following methods for three$-$year period to $31$ December $2018(10$ Marks$)$

a$)$ Straight line

b$)$ Double Declining method

c$)$ Sum of the years$$ digits, and

d$)$ Units of production

ii$.$ Which depreciation method will maximize net income for the financial statement reporting for the three$-$year period $(2$ Marks$)$

iii. Prepare a schedule showing the amount of accumulated depreciation at $31$ December $2018$ under your choice method in $($ii$)$ above $(3$ marks$)$