Financial accounting 16th Edition by Jan Williams,Susan Haka,Mark Bettner ,Joseph Carcello

Exercise 60

R R, Inc., purchased a new machine on September 1, 2013, at a cost of $180,000.he machine's estimated useful life at the time of the purchase was five years, and its expected residual value was $10,000.
Instructions
a.repare a complete depreciation schedule, beginning with calendar year 2013, under each of the methods listed below (assume that the half-year convention is used):
1.traight-line.
2.00 percent declining-balance.
3.50 percent declining-balance (not switching to straight-line).
b.hich of the three methods computed in part a is most common for financial reporting purposes Explain.
c.ssume that R R sells the machine on December 31, 2016, for $58,000 cash.ompute the resulting gain or loss from this sale under each of the depreciation methods used in part a.oes the gain or loss reported in the company's income statement have any direct cash effects Explain.