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Question 1: 25 marks (Units-of-Production, Straight-Line, and DDB) Rocky Bay Mining Company (Rocky Bay) buys special drills for $640,000 each. Each drill can extract about
Question 1: 25 marks (Units-of-Production, Straight-Line, and DDB) Rocky Bay Mining Company ("Rocky Bay) buys special drills for $640,000 each. Each drill can extract about 150,000 tons of ore, after which it has a $40,000 residual value. Rocky Bay bought one such drill in early January 2019. Projected tonnage figures for the drill are 70,000 tons in 2019, 45,000 tons in 2020 , and 35,000 tons in 2021. The drill is scheduled for sale at the end of the third year at the $40,000 residual value. Rocky Bay is considering units-of-production, straight-line, or double declining balance ("DDB") depreciation for the drill. Compute depreciation for each year under each of the three methods
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