Your company, Dayak Baru Enterprise Sdn Bhd. acquired an item of equipment on 1 January 2020 at a cost of RM50,000. The machine has an estimated useful life of five years and an estimated salvage value of RM10,000.

Required:

From the perspective of management, from among the straight-line method, declining-balance method, and sum-of-the-years- digits method of depreciation, which method should be chosen for the financial statements t income is to be at a maximum the first year? Which method should be chosen for the income tax returns, assuming that the tax rate stays the same each year? Explain and show your computations.