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On July 1, 2020, Sparks Company purchased for P2,160,000 snow-making equipment having an estimated useful life of 5 years with an estimated salvage value of P90,000. Depreciation is taken for the portion of the year the asset is used.
Question a. Calculate the depreciation expense for the years 2020, 2021 and 2022 by each of the following methods, showing the figures used.
i. Straight-line
ii. Double-declining balance
iii. Sum-of-the-years'-digits
Question b. Assume the company had used straight-line depreciation during 2020 and 2021. During 2022, the company determined that the equipment would be useful to the company for only one more year beyond 2022. Salvage value is estimated at P120,000. Compute the amount of depreciation expense for the 2022 income statement.
Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest. How much control does the Fed have over this longer real rate?
Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.
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