Bonita Manufacturing purchased a machine on January 1, 2023 for use in its factory. Bonita paid $799,000 for the machine and estimated that it had a useful life of 10 years, at the end of which time the machine was expected to have a residual value of $20,000. During its life, the machine was expected to produce 380,000 units. During 2023, the machine produced 42,700 units, and produced 61,500 in 2024. The machine was subject to a 20% CCA rate, and Bonita's year-end was December 31. The machine is eligible for the Accelerated Investment Incentive. (a) Calculate the annual depreciation amount for 2023 and 2024 using the straight-line method. b) Calculate the annual depreciation amount for 2023 and 2024 under the activity method. c) Calculate the annual depreciation amount for 2023 and 2024 under the double-declining balance method. d) Calculate the annual depreciation amount for 2023 and 2024 under the capital cost allowance method.
Bonita Manufacturing purchased a machine on January 1, 2023 for use in its factory. Bonita paid $799,000 for the machine and estimated that it had a useful life of 10 years, at the end of which time the machine was expected to have a residual value of $20,000.
During its life, the machine was expected to produce 380,000 units. During 2023, the machine produced 42,700 units, and produced 61,500 in 2024. The machine was subject to a 20% CCA rate, and Bonita's year-end was December 31. The machine is eligible for the
Accelerated Investment Incentive.
(a) Calculate the annual
b) Calculate the annual depreciation amount for 2023 and 2024 under the activity method.
c) Calculate the annual depreciation amount for 2023 and 2024 under the double-declining balance method.
d) Calculate the annual depreciation amount for 2023 and 2024 under the capital cost allowance method.
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