Hearty Fried Chicken bought equipment on January 2, 2024, for $21,000. The equipment was expected to remain in service for four years and to operate for 4,500 hours. At the end of the equipment's useful life, Hearty estimates that its residual value will be $3,000. The equipment operated for 450 hours the first year, 1,350 hours the second year, 1,800 hours the third year, and 900 hours the fourth year. Read the requirements Requirement 1. Prepare a schedule of depreciation expense, accumulated depreciation, and book value per year for the equipment under the three depreciation methods: straight-line, units-of-production, and double-declining-balance. Show your computations. Note: Three depreciation schedules must be prepared. Begin by preparing a depreciation schedule using the straight-line method. Straight-Line Depreciation Schedule Asset Cost Date 1-2-2024 S 21,000 12-31-2024 12-31-2025 12-31-2026 12-31-2027 Depreciable Cost S Depreciation for the Year Useful Life 18,000 - 18,000 + 18,000 + 18,000 4 years 4 years 4 years 4 years Depreciation Expense =$ )+ Accumulated Depreciation 4,500 $ 4,500 4,500 4,500 4,500 9,000 13,500 18,000 D = = S Book Value Before calculating the units-of-production depreciation schedule, calculate the depreciation expense per unit. Select the formula, then enter the amounts and calculate the depreciation expense per unit. Depreciation per unit 21,000 16,500 12,000 7,500 3,000
Hearty Fried Chicken bought equipment on January 2, 2024, for $21,000. The equipment was expected to remain in service for four years and to operate for 4,500 hours. At the end of the equipment's useful life, Hearty estimates that its residual value will be $3,000. The equipment operated for 450 hours the first year, 1,350 hours the second year, 1,800 hours the third year, and 900 hours the fourth year. Read the requirements Requirement 1. Prepare a schedule of depreciation expense, accumulated depreciation, and book value per year for the equipment under the three depreciation methods: straight-line, units-of-production, and double-declining-balance. Show your computations. Note: Three depreciation schedules must be prepared. Begin by preparing a depreciation schedule using the straight-line method. Straight-Line Depreciation Schedule Asset Cost Date 1-2-2024 S 21,000 12-31-2024 12-31-2025 12-31-2026 12-31-2027 Depreciable Cost S Depreciation for the Year Useful Life 18,000 - 18,000 + 18,000 + 18,000 4 years 4 years 4 years 4 years Depreciation Expense =$ )+ Accumulated Depreciation 4,500 $ 4,500 4,500 4,500 4,500 9,000 13,500 18,000 D = = S Book Value Before calculating the units-of-production depreciation schedule, calculate the depreciation expense per unit. Select the formula, then enter the amounts and calculate the depreciation expense per unit. Depreciation per unit 21,000 16,500 12,000 7,500 3,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Hearty Fried Chicken bought equipment on January 2, 2024, for $21,000. The equipment was expected to remain in service for four years and to operate for 4,500 hours. At the end of the equipment's useful life,
Hearty estimates that its residual value will be $3,000. The equipment operated for 450 hours the first year, 1,350 hours the second year, 1,800 hours the third year, and 900 hours the fourth year.
Read the requirements
Requirement 1. Prepare a schedule of depreciation expense, accumulated depreciation, and book value per year for the equipment under the three depreciation methods: straight-line, units-of-production,
and double-declining-balance. Show your computations. Note: Three depreciation schedules must be prepared.
Begin by preparing a depreciation schedule using the straight-line method.
Straight-Line Depreciation Schedule
Date
1-2-2024 $
12-31-2024
12-31-2025
12-31-2026
12-31-2027
Asset
Cost
21,000
Depreciable
Cost
Depreciation for the Year
18,000
18,000
18,000
18,000 -
P
Useful
Life
4 years
4 years
4 years
4 years
game
Depreciation Accumulated
Depreciation
Expense
ACCE
69
4,500 $
4,500
4,500
4,500
4.500
9.000
13.500
18.000
**
S
Imani
$
Before calculating the units-of-production depreciation schedule, calculate the depreciation expense per unit. Select the formula, then enter the amounts and calculate the depreciation expense per unit.
Depreciation per unit
Book
Value
21,000
16,500
12,000
7,500
3,000
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