Straight Line Year, t D(t) SL book value Examples $ 7,000 $ 73,000.00 D(1) =DB(C$2,C$3,C$4, A8) 2 $ 7,000 $ 66,000.00 D(1)=DDB(C$2,C$3,C$4,A8) $ 7,000 $ 59,000.00 D(1)=SYD(C$2,C$3,C$4,A22) $ 7,000 $ 52,000.00 D(1) = SLN(C$2,C$3,C$4) 5 $ 7,000 $ 45,000.00 MACRS (1) = 80,000*0.10 $ 7,000 $ 38,000.00 $ 7,000 $ 31,000.00 $ 7,000 $ 24,000.00 $ 7,000 $ 17,000.00 10 $ 7,000 $ 10,000.00\fInstructions: The general obiectives of this activity are to develop prociency in the Microsoft Excel spreadsheet, to calculate the depreciation charge for different deprecialion methods, and to compute the book value of ditterent assets using different depreciation methods. Also, to determine the best alternative using the present worth of after tax cash tiows {ATGF} and to perform a sensitivity analysis. This activityr has a grade of 1|] points. General Requirements: - Read from the textbook the example 1?.3. The assignment is based on this example. - Also read from the textbook Example 'l. 3. This example is a good model to follow to com plete the assignment. at the end of his lhird assignment there is also an explanation ot how to constnrct it in Exoel. - Have available the Microsoft Excel software program. - Answer and hand in the assignment questions in a Microsoft word sheet and at least fteen [15} sheets of the Microsoft Excel software. For example: one sheet of Microsoft Excel using the straight line depreciation method, emitter with the declining balance, the lhird with double declining balance, the sum of the digits depreciation method and the last one using the MARGS method. When the whole assignment is cornpiete you will have worked 15 Excel sheets. Steps: 1. Start the Microsoft Excel soware program. 2. Use me 113 data to complete the assignment. 3. The rst costs is: [E32] = $553,000 Salvage value is: [BE] = $150,000 Recovery period is: {EH} = 5 Depreciation method is: {(32} = [different in each page} Tax rate is: {03} = D35 :11. Enter the data as in the examples 1E - 3 and 1? - 3 in the Microsoft Excel spreadsheet. Remember the data is from example 113. Notes: on To format columns with numbers: right click the mouse, select tonnat cell, and number. You also may select currency. a The emptyI spaces must be lled with Us. 5. To compute the depreciation charge select from the upper menu {'E'K}, 'ien select nancial, and then DB {declining balance}, DDB [Double declining balance}, ELM [straight line}, S'I'D {Sum of year digits}. Use the MARDS table to compute the depreciation charge. At the end of the assignment are the examples of how to enter the depreciation method. 5. Solye example 113 using a different depreciation method [each method in a different page]. Also compute the MACRS method. T. Decide the best atternatiye [depreciation method] by compa'ing the alter cash ows using the present worth method. Note: In each Microsoft Excel sheet you will produce a sheet with a different depreciation schedule as in example 16.3, and in the same Excel sheet a before and after tax cash ow schedule as in die example 1T3. Total ve {5} Microsoft Excel sheets. Questions: 1. |nl'il'hicti depreciation method gives ie higher alter tax cash ow? 2. It revenues decrease each year loy a constant of $20,000, tor example in year 1 {200,000}, in year 2 {100,000}, etc_, will your decision ot the best depreciation method change? Why or why not? Construct another set of litre [5] Microsoft Excel sheets to answer this question. a. It revenues increase each year by a constant of $20,000, for example in year 1 [$200,000], in year 2 {$220,030}, etc, will your decision of lhe best depreciation method change? Why or why not? Construct another set of titre {5] Microsoft Excel sheets to answer this question.