Question Two: (12 Marks) Watson Company purchased packaging equipment on January 5, 2012, for $125,000. The company also paid, for the followings, Testing for use $3500, Assembly $2500, Fines for not obtaining proper permits from government $2500. The equipment was expected to have a useful life of three years, or 20,000 operating hours, and a residual value of $11,000. The equipment was used for 8,600 hours during 2012, 6,300 hours in 2013, and 5,100 hours in 2014. Requirements: 1. Prepare depreciation analysis table using straight line method and Unit of production method. 2. Watson Company revised its estimate for Packaging equipment on January 1* 2014. Revised estimated show the equipment has 3 years remain life and a residual value of $2000. Prepare new revised deprecation analysis table. (use straight line method) 3. The Company sold the equipment on 18th September 2013 for $35,000 Journalize the transaction. 4. The Company sold the equipment on 27th February 2016 for $1000. Journalize the transaction. Page 1 Professor: Soran Sadiq 5. On July 10th the packaging equipment was damaged and Watson has no choose but to discard the equipment, journalize the discard