Question
Problem 1 (31.5 points) Comfort Corporation is a company that manufactures and sells chairs. On 1/1/21, the company purchases a piece of manufacturing equipment for
Problem 1 (31.5 points)
Comfort Corporation is a company that manufactures and sells chairs. On 1/1/21, the company purchases a piece of manufacturing equipment for $6,200,000 cash. The expected residual value is $400,000 and the useful life is 5 years. The company expects to produce 5,000,000 chairs with the equipment 1,200,000 chairs in 2021; 1,400,000 chairs in 2022; 1,000,000 chairs in 2023; and 600,000 chairs 2024; and 800,000 chairs in 2025.
SHOW YOUR WORK! Round per unit to the nearest cent.
Assume that Comfort Corporation uses the Straight-Line method of depreciation.
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| 2021 | 2022 | 2023 | 2024 | 2025 |
| Depreciation Expense for the year |
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| Accumulated Depreciation at year-end |
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| PPE, Net on year-end Balance Sheet |
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Assume that Comfort Corporation uses the Units-of-Activity method of depreciation.
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| 2021 | 2022 | 2023 | 2024 | 2025 |
| Depreciation Expense for the year |
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| Accumulated Depreciation at year-end |
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| PPE, Net on year-end Balance Sheet |
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