Question 3 (20 Marks) On Jan 2, 2018, Sandstone Enterprises purchased equipment for $129,200. The equipment has a useful life of four years or of 13,000 working hours and after the useful life it will have a residual value of $13,500. The machine was used for 1,900 hours in 2018, 2,800 hours in 2019; 3,700 hours in 2020. Required: 1. Calculate the depreciation expense for 2018 and 2019 under each of the following methods: (15 marks) i. Straight-line, ii. Double diminishing-balance, and iii. Units-of-production 2. Record the journal entry for depreciation expense for the year ended December 31, 2018 under the straight-line method. (2 marks) 3. Which method results in the lowest profit for the first two years? Why? (3 marks) Question 4 (20 Marks) Zello Corporation purchased a delivery truck for $400,000 on September 1, 2019, by paying 20% down payment in cash and for the balance amount signed a 5%, 10-month note payable for the balance amount. Interest and principle will be paid back together at the end of the note. Prepare journal entries to record: (14 Marks) the purchase of the delivery truck, ii. the adjusting journal entry to record the accrued interest on December 31, ... and the payment of the note at maturity along with the interest b) On January 1, 2020, Zello Corp. issued $250,000 face value, 5-year bonds, with a coupon rate of 7.5%. Coupon is paid semi-annually on June 30 and December 31 each year. Prepare the necessary journal entries to record the: (6 marks) issuance of the bonds on Jan 1, 2020 in payment of first coupon payment on June 30, 2020. 1)