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Question 2 (20 marks) 3030 Limited purchased a machine on 1 January 2019 at $500,000. It has an expected useful life of 5 years and

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Question 2 (20 marks) 3030 Limited purchased a machine on 1 January 2019 at $500,000. It has an expected useful life of 5 years and an estimated salvage value of $50,000. It is also expected that the machine can run for 30,000 hours. For the year ended 30 June 2020, 3030 has used the machine for 4,000 hours. 3030 has another equipment with the following data on 30 June 2020. Cost $260,000 Carrying amount $200,000 Fair value less costs to sell $180,000 Value-in-use $1 '15 ,000 8080 has a shop in which it carries out retail business. During the year ended 30 June 2020, it had a sale of $79,644 and net income of $5,584. The carrying amount of the shop on 30 June 2020 was $125,711 Required: (a) For the machine, calculate the depreciation expense for the year ended 30 June 2020 using straight-line method. (2 marks) (b) For the machine, calculate the depreciation expense for the year ended 30 June 2020 using activity-based method. (2 marks) (c) For the machine, calculate the depreciation expense for the year ended 30 June 2020 using declining-balance method. (2 marks) (d) For the machine, calculate the depreciation expense for the year ended 30 June 2020 using sum-of-the-years'-digits method. (2 marks) (e) Discuss when a company should perform an impairment review for the equipment. (3 marks) (f) Determine the impairment loss for the equipment on 30 June 2020. (3 marks) (g) Compute the asset turnover for the shop for the year 2020. (Round to 3 decimal places.) (2 marks) (h) Compute the profit margin on sales for the shop the year 2020. (Round to 3 decimal places.) (2 marks) (i) Compute the return on assets for the shop the year 2020. (Round to 3 decimal places.) (2 marks) [Total for Question 2: 20 marks]

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