# accounting qep

accounting qep.

## Instructions

 Requirement 1 Use Excel to prepare depreciation schedules for straight-line, double-declining-balance, and units-of-production methods. (Always use cell references and formulas where appropriate to receive full credit. Enter all amounts as positive values. Do not use a minus sign or parentheses for any values.) Requirement 2 Prepare a second depreciation schedule for double-declining-balance method, using the Excel function DDB. The DDB function cannot be used in the last year of the asset’s useful life. (Always use cell references and formulas where appropriate to receive full credit. Enter all amounts as positive values. Do not use a minus sign or parentheses for any values.) Requirement 3 At December 31, 2018, Fraser River is trying to determine if it should sell the factory equipment. Fraser River will only sell the factory equipment if the company earns a gain of at least \$6,000. For each of the depreciation methods, what is the minimum amount that Fraser River will sell the factory equipment for in order to have a gain of \$6,000? (Always use cell references and formulas where appropriate to receive full credit. Enter all amounts as positive values. Do not use a minus sign or parentheses for any values.) **For calculations in each of the four tables below refer only to the values calculated in the same table or provided in the DATA table. DATA Cost \$ 400,000.00 Residual Value \$ 20,000.00 Useful Life (Years) 4 Useful Life (Hours) 8,000 Gain End of Year 1 \$ 6,000.00 Straight Line Year Depreciable Cost Rate Depreciation Expense Accumulated Depreciation Book Value 1 2 3 4 The minimum amount to sell the factory equipment in order to have a gain of \$6,000 at the end of Year 1? Double Declining Balance Double Declining Balance using DDB function Year Book Value Beginning of Year Rate Depreciation Expense Accumulated Depreciation Book Value End of Year Year Depreciation Expense Accumulated Depreciation Book Value 1 1 2 2 3 3 4 4 The minimum amount to sell the factory equipment in order to have a gain of \$6,000 at the end of Year 1? Units of Production Year Depreciation Per Unit Machine Hours Depreciation Expense Accumulated Depreciation Book Value 1 2,400 2 1,800 3 2,480 4 1,320 The minimum amount to sell the factory equipment in order to have a gain of \$6,000 at the end of Year 1? HINTS Cell | Hint: C24:D27 | Use absolute cell references to the corresponding cells in the DATA table to calculate depreciable cost and depreciation rate values for periods 1-4. (Absolute cell reference uses \$, example \$A\$1) ALL Book Value columns | Use absolute cell reference to the corresponding cell in the DATA table and the values obtained in the Accumulated Depreciation column to calculate the book values for periods 1-4. J34:J37 | Use the function =DDB() to calculate the depreciation expense. Do not enter any value for the FACTOR argument of the DDB function. Note that the DDB function cannot be used in the last year of the asset’s useful life (cell J37). D37 | Leave this cell blank. G39 | Do not use cell references to the values in the Double Declining Balance using DDB function table. C44:C47 | Use absolute cell references to the corresponding cells in the DATA table to calculate depreciation per unit values for periods 1-4.

accounting qep

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