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please answer section above. I'll give up vote if correct Sandhill Co. purchased equipment on March 31, 2021, at a cost of $280,000. Management is
please answer section above. I'll give up vote if correct
Sandhill Co. purchased equipment on March 31, 2021, at a cost of $280,000. Management is considering the merits of using the diminishing-balance or units-of-production method of depreciation instead of the straight-line method, which it currently uses for other equipment. The new equipment has an estimated residual value of $8,000 and an estimated useful life of either four years or 80.000 units. Demand for the products produced by the equipment is sporadic so the equipment will be used more in some years than in others. Assume the equipment produces the following number of units each year: 14,800 units in 2021, 20.400 units in 2022; 19.800 units in 2023; 20,000 units in 2024; and 5,000 units in 2025. Sandhill has a December 31 year end. (a) Your answer is correct. Prepare separate depreciation schedules for the life of the equipment using: (Round depreciation per unit to 2 decimal places, e.g. 5.28 and final answers to 0 decimal places, eg. 5,275.) Straight-line method: Depreciable Amount Depreciation Expense Accumulated Depreciation Carrying Amount Year $ 280000 229000 $ 51000 272,000 51000 2021 $ 68000 119000 161000 272,000 2022 68000 187000 93000 2023 272.000 255000 25000 68000 272.000 2024 8000 17000 272000 72 no $ 280000 2021 $ 272.000 $ 51000 $ 51000 229000 2022 272.000 68000 119000 161000 2023 272.000 68000 187000 93000 2024 272.000 68000 255000 25000 2025 272.000 17000 272000 8000 > Double-diminishing-balance method: Opening Carrying Amount Depreciation Expense Accumulated Depreciation Carrying Amount ar $ 280000 21 S 280000 $ 105000 $ 105000 175000 22 175000 87500 192500 87500 23 87500 43750 236250 43750 24 43750 21875 258125 21875 21875 25 13875 272000 8000 24 43750 21875 258125 21875 25 21875 13875 272000 8000 Units-of-production method: Depreciation Expense Accumulated Depreciation Carrying Amount Year Units-of-Production 280000 2021 14800 $ 50320 $ 50320 229680 2022 20400 69360 119680 160320 2023 19800 67320 187000 93000 2024 20000 68000 255000 25000 2025 5000 17000 272000 8000 e Textbook and Media Compare the total depreciation expense and accumulated depreciation under each of the three methods over the life of the equipment. (Round answers to 0 decimal places, eg. 5,275.) Double-Diminishing- Balance Straight-Line Units-of-Production Total depreciation expense $ $ $ Accumulated depreciationStep by Step Solution
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