1. A cooling water pumping station at a manufacturing plant in ligan City costs P30,000,000 to construct, and it is projected to have a 25-year life with an estimated salvage value of 10% of the construction cost. Calculate the annual depreciation charge for year 10 (d,so) using: Depreciation Method a) Straight Line Method b) Declining Balance Method c) Double Declining Balance Method d) Sinking Fund Method at 10% e) Sum-of-the-Years' Digits Method To verify your answers, solve both a) manually (3-decimal accuracy, dio only) and b) by using spreadsheets (choose any 2 methods) - build the depreciation and book value schedules. 2. If the cooling water pumping station in Problem 1 will be book-depreciated to zero over a recovery period of 30 years, calculate do manually using the double declining balance method

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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1. A cooling water pumping station at a manufacturing plant in Iligan City costs P30,000,000 to construct,
and it is projected to have a 25-year life with an estimated salvage value of 10% of the construction
cost. Calculate the annual depreciation charge for year 10 (d10) using:
Depreciation Method
a) Straight Line Method
b) Declining Balance Method
c) Double Declining Balance Method
d) Sinking Fund Method at 10%
e) Sum-of-the-Years' Digits Method
To verify your answers, solve both
a) manually (3-decimal accuracy, dio only) and
b) by using spreadsheets (choose any 2 methods) - build the depreciation and book value schedules.
2. If the cooling water pumping station in Problem 1 will be book-depreciated to zero over a recovery
period of 30 years, calculate di0 manually using the double declining balance method
Transcribed Image Text:1. A cooling water pumping station at a manufacturing plant in Iligan City costs P30,000,000 to construct, and it is projected to have a 25-year life with an estimated salvage value of 10% of the construction cost. Calculate the annual depreciation charge for year 10 (d10) using: Depreciation Method a) Straight Line Method b) Declining Balance Method c) Double Declining Balance Method d) Sinking Fund Method at 10% e) Sum-of-the-Years' Digits Method To verify your answers, solve both a) manually (3-decimal accuracy, dio only) and b) by using spreadsheets (choose any 2 methods) - build the depreciation and book value schedules. 2. If the cooling water pumping station in Problem 1 will be book-depreciated to zero over a recovery period of 30 years, calculate di0 manually using the double declining balance method
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