. On April 22, 2023, Sunlight Enterprises purchased equipment for $134,400. The company expects to use the equipment for 11,500 working hours during its four-year life and that it will have a residual value of $12,500. Sunlight has a December 31 year end and pro-rates depreciation to the nearest month. The actual machine usage was: 1,700 hours in 2023; 2,600 hours in 2024; 3,500 hours in 2025; 3,000 hours in 2026; and 900 hours in 2027. Please explain & show steps for each.  a) Complete a depreciation schedule for the life of the asset under each of the following methods: (straight-line, double diminishing-balance assuming a rate of 50%, and units-of-production.) b) Which method results in the lowest

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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1. On April 22, 2023, Sunlight Enterprises purchased equipment for $134,400. The company expects to use the equipment for 11,500 working hours during its four-year life and that it will have a residual value of $12,500. Sunlight has a December 31 year end and pro-rates depreciation to the nearest month. The actual machine usage was: 1,700 hours in 2023; 2,600 hours in 2024; 3,500 hours in 2025; 3,000 hours in 2026; and 900 hours in 2027.

Please explain & show steps for each. 

a) Complete a depreciation schedule for the life of the asset under each of the following methods: (straight-line,
double diminishing-balance assuming a rate of 50%, and units-of-production.)

b) Which method results in the lowest profit over the life of the asset?

c) Which method results in the least cash used for depreciation over the life of the asset?

Calculate partial-year depreciation using different methods.

 

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