On January 1 2017, R. Rhooms, a Manufacturer, purchased a drill machine for the sum of $4,000,000 paying by cheque. It has an estimated life of 5 years and a scrap value $500,000. Rhooms has chosen to use the straight-line method of depreciation.

You have been asked to prepare the following for the first three (3) years:

(a) Machinery account (2 marks)

(b) Journal entries to record depreciation (6 marks)

(c) Provision for depreciation account (8 marks)

(d) Balance sheet extract (9 marks)