Sunshine Corporation purchased a new machine on Jan 4, 2019 for $256,000 cash. The machine has a useful life of ten years or of 30,000 hours. After the useful life the machine will have a residual value of $3,000. The machine was used for 4,400 hours in 2019 and 5,200 hours in 2020.

Required:

a. Calculate the depreciation expense for 2019 and 2020 under each of the following methods:

i. Straight-line (3 marks)

ii. Double diminishing-balance (5 marks)

iii. Units-of -production (5 marks)

b. Calculate the carrying amount at the end of 2020 for the machine when the company is using the Straight-line depreciation method. (3 marks)

c. Record the journal entry for the cash purchase of the machine on Jan 4, 2019 and for its depreciation expense for the year ended December 31, 2020 under the double diminishing balance method. (4 marks)