The Small Company has purchased equipment costing $400,000 with additional charges of $50,000 for installation and Marks delivery. The expected useful life of the equipment is estimated to be 10 years with $50,000 salvage value after that time. Using the Straight-Line method of depreciation and assuming the equipment was purchased at the beginning of the financial year, you are required to:

(a) Calculate the annual depreciation expense

(b) Calculate and show the Balance Sheet extract for Equipment at the second and third year.