Grouper Corp. purchased machinery for $492,000 on May 1, 2020. It is estimated that it will have a useful life of 10 years, a residual value of $12,000, production of 192,000 units, and 30,000 working hours. The machinery will have a physical life of 15 years and a salvage value of $3,000. In 2021, Grouper Corp. used the machinery for 2,250 hours and the machinery produced 27,000 units. Grouper prepares financial statements in accordance with IFRS. From the information given, calculate the depreciation charge for 2021 under each of the following methods, assuming Grouper has a December 31 year-end. calculate the CCA for 2024 when the CCA rate is 20%, assuming machinery is eligible for the accelerated investment incentive

Grouper Corp. purchased machinery for $492,000 on May 1, 2020. It is estimated that it will have a useful life of 10 years, a residual value of $12,000, production of 192,000 units, and 30,000 working hours. The machinery will have a physical life of 15 years and a salvage value of $3,000. In 2021, Grouper Corp. used the machinery for 2,250 hours and the machinery produced 27,000 units. Grouper prepares financial statements in accordance with IFRS. From the information given, calculate the depreciation charge for 2021 under each of the following methods, assuming Grouper has a December 31 year-end. calculate the CCA for 2024 when the CCA rate is 20%, assuming machinery is eligible for the accelerated investment incentive

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter11: Depreciation, Depletion, Impairment, And Disposal

Section: Chapter Questions

Problem 8P: Kam Company purchased a machine on January 2, 2019, for 20,000. The machine had an expected life of...

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Montello Inc. purchases a delivery truck for $25,000. The truck has a salvage value of $6,000 and is expected to be driven for 125,000 miles. Montello uses the units-of-production depreciation method, and in year one it expects to use the truck for 26,000 miles. Calculate the annual depreciation expense.
Utica Machinery Company purchases an asset for 1,200,000. After the machine has been used for 25,000 hours, the company expects to sell the asset for 150,000. What is the depreciation rate per hour based on activity?
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Hathaway Company purchased a copying machine for 8,700 on October 1, 2019. The machines residual value was 500 and its expected service life was 5 years. Hathaway computes depreciation expense to the nearest whole month. Required: 1. Compute depredation expense (rounded to the nearest dollar) for 2019 and 2020 using the: a. straight-line method b. sum-of-the-years-digits method c. double-declining-balance method 2. Next Level Which method produces the highest book value at the end of 2020? 3. Next Level Which method produces the highest charge to income in 2020? 4. Next Level Over the life of the asset, which method produces the greatest amount of depreciation expense?
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