Posted: March 31st, 2016

1. Why would a company use straight line depreciation to prepare its financial statements and the declining balance method using twice the straight line rate to prepare it tax return?

1. Why would a company use straight line depreciation to prepare its financial statements and the declining balance method using twice the straight line rate
to prepare it tax return?

2. A company purchased a machine on January 1, 2011 for $400,000. The machine had an expected useful life of 10 years and it was expected to be able to produce 1 million units during the 10 years. The expected salvage value of the machine was $20,000. During 2011, 90,000 units were produced.