Grove Company acquired a production machine on January 1, 2022, at a cost of $540,000. The machine is expected to have a four-year useful life, with a salvage value of $104,000. The machine is capable of producing 74,000 units of product in its lifetime. Actualproduction was as follows: 16,280 units in 2022; 23,680 units in 2023; 20,720 units in 2024; 13,320 units in 2025.Following is the comparative balance sheet presentation of the net book value of the production machine at December 31 for eachyear of the asset's life, using three alternative depreciation methods (items a to c):Required:Identify the depreciation method used for each of the following comparative balance sheet presentations (items a to c). If a declining-balance method is used, be sure to indicate the percentage (150% or 200%). (Hint: Read the balance sheet from right to left todetermine how much has been depreciated each year. Remember that December 31, 2022, is the end of the first year.)a.b.C.Production Machine, Net of Accumulated DepreciationDepreciation MethodAt December 3120232024213,000322,000182,480 304,560135,0002025104,000104,000104,000 104,0002022431,000444,080270,000

Formula :Straight line methodAnnual depreciation =cost – salvage value / useful…

uction was as follows: 16,280 units in 2022; 23,680 units in 2023; 20,720 units in 2024; 13,320 units in 2025. owing is the comparative balance sheet presentation of the net book value of the production machine at December 31 for e of the asset's life, using three alternative depreciation methods (items a to c):

uction was as follows: 16,280 units in 2022; 23,680 units in 2023; 20,720 units in 2024; 13,320 units in 2025. owing is the comparative balance sheet presentation of the net book value of the production machine at December 31 for e of the asset's life, using three alternative depreciation methods (items a to c):

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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