Solar Innovations Corporation bought a machine at the beginning of the year at a cost of $39,000. The estimated useful life was fiveyears and the residual value was $4,000. Assume that the estimated productive life of the machine is 20,000 units. Expected annualproduction was year 1, 4,600 units; year 2, 5,600 units; year 3, 4,600 units; year 4, 4,600 units; and year 5, 600 unitsRequired:00:58:39. Complete a depreciation schedule for each of the alternative methods.a. Straight-line.b. Units-of-production.c. Double-declining-balance.eBook2. Which method will result in the highest net income in year 2? Does this higher net income mean the machine was used moreefficiently under this depreciation method?Complete this question by entering your answers in the tabs belowReq 1AReq 1BReq 1CReq 2AReq 2BComplete a depreciation schedule for Double-declining-balance method. (Do not round intermediate calculations. Round finalanswers to the nearest whole dollars.)IncomeStatementBalance SheetDepreciationExpenseAccumulatedDepreciation Book ValueYearCostAt acquisition2345Req 1Req 2A >

Rate of SLM =100/5 = 20% Therefore, Rate of DDB = 20% *2 = 40%

Answered: Solar Innovations Corporation bought a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Speed Runner Company has acquired huge machinery at a cost of $150,000 (with no breakdown of the component parts). The estimated useful life is 8 years. At the end of the fifth year, the main engine requires replacement, the remainder of the machinery is perfectly worthy and is expected to last for the next three years. The cost of a new engine is $85,000 with discounted amount of $63,400 (discounted back five years with rate 6% = $63,400). Required: Compute the cost of the machinery. (2 Points)
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