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Waller Company purchased equipment for $24,000. The company is considering whether to determine annual depreciation using the straight-line method or the declining-balance method at 150 percent of the straight-line rate. Waller expects to use the equipment for 10 years, at the end of which it will have an estimated salvage value of $4,000.
Question 1: Prepare comparison of these two alternatives for the first two years Waller will own the equipment.
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