Question
Q2/please I posted before 2 days but the answer are wrong Please answer question Pharoah Limited purchased a machine on account on April 2, 2018,
Q2/please I posted before 2 days but the answer are wrong Please answer question
Pharoah Limited purchased a machine on account on April 2, 2018, at an invoice price of $356,620. On April 4, it paid $2,130 for delivery of the machine. A one-year, $3,970 insurance policy on the machine was purchased on April 5. On April 18, Pharoah paid $7,590 for installation and testing of the machine. The machine was ready for use on April 30. Pharoah estimates the machines useful life will be five years or 6,212 units with a residual value of $73,690. Assume the machine produces the following numbers of units each year: 896 units in 2018; 1,400 units in 2019; 1,405 units in 2020; 1,396 units in 2021; and 1,115 units in 2022. Pharoah has a December 31 year end.
A/ Determine the cost of the machine.
Cost of the machine | $ |
B/
Calculate the annual depreciation and total depreciation over the assets life using: (Round the depreciation cost per unit to the nearest cent. Round answers to 0 decimal places, e.g. 5,275.) (1) Straight-line method
Year | Depreciable Cost | Depreciation Expense | Accumulated Depreciation | Carrying Amount | ||||
2018 | $ | $ | $ | $ | ||||
2019 |
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2020 |
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2021 |
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2022 |
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2023 |
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(2) Double-diminishing-balance method
Year | Opening Carrying Amount | Depreciation Expense | Accumulated Depreciation | Carrying Amount | ||||
2018 | $ | $ | $ | $ | ||||
2019 |
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2020 |
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2021 |
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2022 |
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2023 |
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(3) Units-of-production method
Year | Units-of-production | Depreciation Expense | Accumulated Depreciation | Carrying Amount | ||||
2018 |
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2019 |
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2020 |
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2021 |
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2022 |
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(4) Which method causes net income to be lower in the early years of the assets life? Straight-Line MethodDouble-Diminishing-Balance MethodUnits-of-Production MethodStraight-Line MethodDouble-Diminishing-Balance MethodUnits-of-Production Method
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