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Homework answers / question archive / On January 1, 2015, Indigo Corporation, a small manufacturer of machine tools, acquired new industrial equipment for $1,300,000

On January 1, 2015, Indigo Corporation, a small manufacturer of machine tools, acquired new industrial equipment for $1,300,000

Accounting

On January 1, 2015, Indigo Corporation, a small manufacturer of machine tools, acquired new industrial equipment for $1,300,000. The new equipment had a useful life of five years and the residual value was estimated to be $59,000. Indigo estimates that the new equipment can produce 14,000 machine tools in its first year. It estimates that production will decline by 1,000 units per year over the equipment's remaining useful life. 

The following depreciation methods may be used: (1) straight-line, (2) double-declining-balance, and (3) unit of production. For tax purposes, the CCA cia —30%. 
♦ (a) 
Prepare a schedule showing the amount of accumulated depreciation at December 31, 2017, under straight-line method, double-declining balance method output method. (Round depreciation per unit to 0 decimal places, e.g. 15 and final answer to 0 decimal places, e.g. 1,575.) 
2015 
2016 
2017 
Straight-line Double-declining balance Units-of-output 

Which of the three depreciation methods would maximize net income for financial statement reporting purposes for the three-year

Option 1

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