P10.12 (L01,6) Depreciation-SL, DDB, SYD, ACT, and MACRS On January 1, 2024, Locke Company, a...
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P10.12 (L01,6) Depreciation-SL, DDB, SYD, ACT, and MACRS On January 1, 2024, Locke Company, a small machine-tool manufacturer, a piece of new industrial equipment. Pertinent data follow: The following depreciation methods may be used: 1. Straight-line 2. Double-declining balance 3. Sum-of-years'-digits 4. Units-of-output MACRS tables Instructions: (AICPA adapted) a. Which depreciation method would maximize net income for financial statement reporting for the 3-year period ending December 31, 2026? Prepare a schedule showing the amount of accumulated depreciation at December 31,2026, under the method selected. Ignore present value, income tax, and deferred income tax considerations. b. Which depreciation method (MACRS or optional straight-line) would minimize net income for income tax reporting for the 3-year period ending December 36, 2026? Determine the amount of accumulated depreciation at December 31, 2026. Ignore present value considerations. NOTE: Enter a formula with cell references into the yellow shaded input cells. When calculating depreciation, use one of Excel depreciation functions with cell references
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P10.12 (L01,6) Depreciation-SL, DDB, SYD, ACT, and MACRS On January 1, 2024, Locke Company, a small machine-tool manufacturer, a piece of new industrial equipment. Pertinent data follow: The following depreciation methods may be used: 1. Straight-line 2. Double-declining balance 3. Sum-of-years'-digits 4. Units-of-output MACRS tables Instructions: (AICPA adapted) a. Which depreciation method would maximize net income for financial statement reporting for the 3-year period ending December 31, 2026? Prepare a schedule showing the amount of accumulated depreciation at December 31,2026, under the method selected. Ignore present value, income tax, and deferred income tax considerations. b. Which depreciation method (MACRS or optional straight-line) would minimize net income for income tax reporting for the 3-year period ending December 36, 2026? Determine the amount of accumulated depreciation at December 31, 2026. Ignore present value considerations. NOTE: Enter a formula with cell references into the yellow shaded input cells. When calculating depreciation, use one of Excel depreciation functions with cell references 