Question 4 On January 1, 20X2, The GenKota Winery purchased a new bottling system. The system has an expected life of 5 years. The system cost $325,000. Shipping, installation, and set up were an additional $35,000. At the end of the useful life, Julie Hayes, chief accountant for GenKota, expects to dispose of the bottling system for $26,000. She further anticipates total output of 668,000 bottles over the useful life. The output for 20x2 was 108,000 bottles, 130,000 (20x3), 150,000 (20X4), 160,000 (20X5), and 120,000 (20X6). i) Prepare depreciation schedules assuming use of the: (a) straight-line depreciation method (b) units-of -production depreciation method (c) double-declining balance depreciation method
Question 4 On January 1, 20X2, The GenKota Winery purchased a new bottling system. The system has an expected life of 5 years. The system cost $325,000. Shipping, installation, and set up were an additional $35,000. At the end of the useful life, Julie Hayes, chief accountant for GenKota, expects to dispose of the bottling system for $26,000. She further anticipates total output of 668,000 bottles over the useful life. The output for 20x2 was 108,000 bottles, 130,000 (20x3), 150,000 (20X4), 160,000 (20X5), and 120,000 (20X6). i) Prepare depreciation schedules assuming use of the: (a) straight-line depreciation method (b) units-of -production depreciation method (c) double-declining balance depreciation method
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question 4
On January 1, 20X2, The GenKota Winery purchased a new bottling system. The system has an
expected life of 5 years. The system cost $325,000. Shipping, installation, and set up were an
additional $35,000. At the end of the useful life, Julie Hayes, chief accountant for GenKota,
expects to dispose of the bottling system for $26,000. She further anticipates total output of
668,000 bottles over the useful life. The output for 20x2 was 108,000 bottles, 130,000 (20x3),
150,000 (20X4), 160,000 (20X5), and 120,000 (20X6).
i) Prepare depreciation schedules assuming use of the:
(a) straight-line depreciation method
(b) units-of -production depreciation method
(c) double-declining balance depreciation method
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