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Question - On June 9, 2016, Carla Vista Company purchased manufacturing equipment at a cost of $344,940. Carla Vista estimated that the equipment will produce 600,782 units over its 5-year useful life, and have a residual value of $14,510. The company has a December 31 fiscal year end and has a policy of recording a half-year's depreciation in the year of acquisition.
Required -
a. Calculate depreciation under the straight-line method for 2016 and 2017
b. Calculate the depreciation expense under the double diminishing-balance method for 2016 and 2017.
c. Calculate the depreciation expense under the units-of-production method, assuming the actual number of units produced was 70,620 in 2016 and 118,160 in 2017.
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