Question $1$: $(12$ marks$)$

Forty$-$Niner Co purchased a computer for $$325,000$ on January $2,2025.$ The company expects

the computer to last for $8$ years or $15,000$ hours of operation, with an estimated residual value of

$$25,000.$ During $2025$ the computer was operated for $2,000$ hours, while in $2026$ it was operated

for $2,600$ hours

Required:

Calculate the depreciation expense for the computer for $2025$ and $2026$ using the following

depreciation methods:

a$)$ Straight$-$line.

b$)$ Double declining balance.

c$)$ Units$-$of$-$production.

Question $2$: $(21$ marks$)$

Crane Co$.$ purchased equipment on March $1,2024,$ for $$105,000$ on account. The equipment

had an estimated useful life of ten years, with a residual value of $$5,000.$ Crane Co$.$ uses the

double declining balance method of depreciation with a $20\%$ rate and calculates depreciation for

partial periods to the nearest month. The company has an August $31$ year end.

Required:

a$)$ Record the acquisition of the equipment on March $1,2024$

b$)$ Record depreciation at August $31,2024,2025,$ and $2026$

c$)$ Record the disposal on September $1,2026,$ under the following separate and unrelated

scenarios:

i$)$ It was scrapped, with no residual value

ii$)$ It was sold for $$55,000$

iii$)$ It was sold for $$45,000$