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The Rowland Clinic purchased a new surgical laser for $74,000. The estimated salvage value is $4,000. The laser has a useful Tire of five years
The Rowland Clinic purchased a new surgical laser for $74,000. The estimated salvage value is $4,000. The laser has a useful Tire of five years and the clinic expect'iti use it hours. It was used 1,600 hours in year 1; 2,100 hours in year 2; 2,400 hours in year 3; 1,900 hours in year 4; 2,000 hours in year 5 Instructions: a) Compute the annual depreciation for each of the-five-years under each of the following methods: I. straight-line II. units-of-activity b) If you were the administrator of the clinic, which method would you deem as most appropriate? Justify your answer c) Which method would result in the lower reported income in the first year? Which method would result in the lower total reported income over the five-year period
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