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Please answer all parts A bowling alley costs $540,000 and has an estimated life of 10 years (SV10 $45,000) years) a. Determine the depreciation for
Please answer all parts
A bowling alley costs $540,000 and has an estimated life of 10 years (SV10 $45,000) years) a. Determine the depreciation for years one through 10 using: l the straight-line method; ii) the 200% declining balance method; and iii) the MACRS method ADR guideline peri b. Compute the present worth of depreciation at EOY zero for each of the three depreciation methods. The MARR is 8% per year c. If a large present worth in Part (b) is desirable, what do you conclude regarding which method is the most desirable? Click the icon to view the summary of the principal features of GDS under MACRS Click the icon to view the GDS Recovery Rates (rk) Click the icon to view the interest and annuity table for discrete compounding when the MARR is 8% per year a. Determine the depreciation amounts using the straight-line, 200% declining balance and MACRS ADR guideline period-10 years) methods. A table containing some of the depreciation values is provided below. Fill in the table below. (Round to the nearest dollar.) Declining Year Straight-Line MACRS Method Method Balance Method $108,000 $86,400 $77,166 4 6 $35,389 $48,168 $28,312 $48,222 10 S49,500 Enter your answer in the edit fields and then click Check Answer. MACRS (GDS) Property Classes and Primary Methods for Calculating Depreciation Deductions GDS Property Class and Depreciation Method 3-year, 200% DB with switchover to SL 5-year, 200% DB with switchover to SL Class Life (Useful Special Rules Life) Four years or less More than 4 years to less than 10 Includes some race horses and tractor units for over-the-road use Includes cars and light trucks, semiconductor manufacturing equipment, qualified technological equipment, computer-based central office switching equipment, some renewable and biomass power facilities, and research and development property Includes single-purpose agricultural and horticultural structures and railroad track. Includes office furniture and fixtures, and property not assigned to a property class Includes vessels, barges, tugs, and similar water transportation equipment Includes sewage treatment plants, telephone distribution plants, and equipment for two-way voice and data communication Excludes real property of 27.5 years or more. Includes municipal sewers 7-year, 200% DB with switchover to SL 10 years to less than 16 10-year, 200% DB with switchover to SL 16 years to less than 20 15-year, 150% DB with switchover to SL 20 years to less than 25 20-year, 150% DB with switchover to SL 25 years or more GDS Recovery Rates (r) for the Six Personal Property Classes Recovery Period (and Property Class) Year 3-year 0.3333 0.4445 0.1481 0.0741 10-year 0.1000 0.1800 0.1440 0.1152 0.0922 0.0737 0.0655 0.0655 0.0656 0.0655 0.0328 7-year 0.1429 0.2449 0.1749 0.1249 0.0893 0.0892 0.0893 0.0446 5-year 0.2000 0.3200 0.1920 0.1152 0.1152 0.0576 15-year 0.0500 0.0950 0.0855 0.0770 0.0693 0.0623 0.0590 0.0590 0.0591 0.0590 0.0591 0.0590 0.0591 0.0590 0.0591 0.0295 20-year 0.0375 0.0722 0.0668 0.0618 0.0571 0.0528 0.0489 0.0452 0.0447 0.0447 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0446 0.0223 2 4 7 8 10 12 13 15 16 17 19 20 21 aThese rates are determined by applying the 200% DB method (with switchover to the method) to the recov Discrete Compounding; i-8% Single Payment Uniform Series Compound Amount Factor To FindF Given P Compound Amount Worth Factor Factor Worth Factor To Find F Given A Capital Recovery Factor To Find A Given P Present Present Factor To Find P Given F To Find P Given A To Find A Given 1.0800 1.1664 1.2597 1.3605 1.4693 1.5869 1.7138 1.8509 1.9990 2.1589 2.3316 2.5182 2.7196 2.9372 3.1722 1.0000 2.0800 3.2464 4.5061 5.8666 7.3359 8.9228 10.6366 12.4876 14.4866 16.6455 18.9771 21.4953 0.9259 1.7833 2.5771 3.3121 3.9927 4.6229 5.2064 5.7466 6.2469 6.7101 7.1390 7.5361 7.9038 8.2442 8.5595 1.0800 0.5608 0.3880 0.3019 0.2505 0.2163 0.1921 0.1740 1.0000 0.4808 0.3080 0.2219 0.1705 0.1363 0.9259 0.8573 0.7938 0.7350 0.6806 0.6302 0.5835 0.5403 0.5002 0.4632 0.4289 0.3971 0.3677 0.3405 0.3152 2 4 0.0940 0.0801 0.0690 0.0601 0.0527 0.0465 0.0413 0.0368 0.1490 0.1327 0.1265 27.1521 0.1168Step by Step Solution
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