Homy Ice Cream Company bought a new ice cream maker at the beginning of the year at a cost of $7,600. The estimated useful life was four years, and the residual value was $800. Assume that the estimated productive life of the machine was 10,000 hours. Actual annual usage was 3,600 hours in year 1; 2,800 hours in year 2; 1,900 hours in year 3; and 1,700 hours in year 4. Required: 1-a. Complete a separate depreciation schedule by using Straight-line method. (Round your answers to the nearest dollar amount. Make sure that the carrying amount at the end of year 4 is equal to the residual value. Depreciation expense for the last period should be calculated as Carrying value of 3rd year minus residual value.) × Answer is complete but not entirely correct. Year Depreciation Expense Accumulated Depreciation Carrying Amount At acquisition 7,600 1 $ 1,700 $ 1,700 5,900 2 1,700 → 3,400 4,200 3 1,700 5,100 ✔ 2,500 4 2,500 x 1,700 x 800 1-b. Complete a separate depreciation schedule by using Units-of-production method. (Round your answers to the nearest dollar amount. Make sure that the carrying amount at the end of year 4 is equal to the residual value. Depreciation expense for the last period should be calculated as Carrying value of 3rd year minus residual value.) Answer is complete and correct. Year Depreciation Expense Accumulated Depreciation Carrying Amount At acquisition $ 7,600 1 S 2,448 $ 2,448 5,152 2 1,904 ✔ 4,352 3,248 3 4 1,292 1,158 5,844 1,956 6,800 → 800 1-c. Complete a separate depreciation schedule by using Double-declining-balance method. (Round your answers to the nearest dollar amount. Make sure that the carrying amount at the end of year 4 is equal to the residual value. Depreciation expense for the last period should be calculated as Carrying value of 3rd year minus residual value.) × Answer is complete but not entirely correct. Accumulated Depreciation Year Depreciation Expense Carrying Amount At acquisition $ 7,600 1 $ 234 3,800 1,900 $ 3,800 5,700 3,800 1,900 1,100 x 6,800 x 800 x 4 0 x 6,800 800 Rungano Corporation is a global publisher of magazines, books, and music, as well as video collections, and it is one of the world's leading direct-mail marketers. Many direct-mail marketers use high-speed Didde press equipment to print their advertisements. These presses can cost more than $1 million. Assume that Rungano owns a Didde press acquired at an original cost of $400,000. It is being depreciated on a straight-line basis over a 20-year estimated useful life and has a $50,000 estimated residual value. At the end of 2024, the press had been depreciated for eight years. On April 1, 2025, a decision was made, on the basis of improved maintenance procedures, that a total estimated useful life of 25 years and a residual value of $73,000 would be more realistic. The fiscal year ends December 31. Required: 1-a. Compute the amount of depreciation expense recorded in 2024. Answer is complete and correct. Depreciation expense $17,500 1-b. Compute the carrying amount of the printing press at the end of 2024. Answer is complete and correct. Carrying amount 260,000 2. Compute the amount of depreciation that should be recorded in 2025. × Answer is complete but not entirely correct. Depreciation expense 11,000 3. Prepare the adjusting entry to record depreciation expense at December 31, 2025. (If no entry is required for a transaction/event, select "No journal entry required" In the first account field.) × Answer is complete but not entirely correct. No date General Journal 1 December 31, 20 Depreciation expense Accumulated depreciation Debit Credit 11,000 x 11,000 x

Homy Ice Cream Company bought a new ice cream maker at the beginning of the year at a cost of $7,600. The estimated useful life was four years, and the residual value was $800. Assume that the estimated productive life of the machine was 10,000 hours. Actual annual usage was 3,600 hours in year 1; 2,800 hours in year 2; 1,900 hours in year 3; and 1,700 hours in year 4. Required: 1-a. Complete a separate depreciation schedule by using Straight-line method. (Round your answers to the nearest dollar amount. Make sure that the carrying amount at the end of year 4 is equal to the residual value. Depreciation expense for the last period should be calculated as Carrying value of 3rd year minus residual value.) × Answer is complete but not entirely correct. Year Depreciation Expense Accumulated Depreciation Carrying Amount At acquisition 7,600 1 $ 1,700 $ 1,700 5,900 2 1,700 → 3,400 4,200 3 1,700 5,100 ✔ 2,500 4 2,500 x 1,700 x 800 1-b. Complete a separate depreciation schedule by using Units-of-production method. (Round your answers to the nearest dollar amount. Make sure that the carrying amount at the end of year 4 is equal to the residual value. Depreciation expense for the last period should be calculated as Carrying value of 3rd year minus residual value.) Answer is complete and correct. Year Depreciation Expense Accumulated Depreciation Carrying Amount At acquisition $ 7,600 1 S 2,448 $ 2,448 5,152 2 1,904 ✔ 4,352 3,248 3 4 1,292 1,158 5,844 1,956 6,800 → 800 1-c. Complete a separate depreciation schedule by using Double-declining-balance method. (Round your answers to the nearest dollar amount. Make sure that the carrying amount at the end of year 4 is equal to the residual value. Depreciation expense for the last period should be calculated as Carrying value of 3rd year minus residual value.) × Answer is complete but not entirely correct. Accumulated Depreciation Year Depreciation Expense Carrying Amount At acquisition $ 7,600 1 $ 234 3,800 1,900 $ 3,800 5,700 3,800 1,900 1,100 x 6,800 x 800 x 4 0 x 6,800 800 Rungano Corporation is a global publisher of magazines, books, and music, as well as video collections, and it is one of the world's leading direct-mail marketers. Many direct-mail marketers use high-speed Didde press equipment to print their advertisements. These presses can cost more than $1 million. Assume that Rungano owns a Didde press acquired at an original cost of $400,000. It is being depreciated on a straight-line basis over a 20-year estimated useful life and has a $50,000 estimated residual value. At the end of 2024, the press had been depreciated for eight years. On April 1, 2025, a decision was made, on the basis of improved maintenance procedures, that a total estimated useful life of 25 years and a residual value of $73,000 would be more realistic. The fiscal year ends December 31. Required: 1-a. Compute the amount of depreciation expense recorded in 2024. Answer is complete and correct. Depreciation expense $17,500 1-b. Compute the carrying amount of the printing press at the end of 2024. Answer is complete and correct. Carrying amount 260,000 2. Compute the amount of depreciation that should be recorded in 2025. × Answer is complete but not entirely correct. Depreciation expense 11,000 3. Prepare the adjusting entry to record depreciation expense at December 31, 2025. (If no entry is required for a transaction/event, select "No journal entry required" In the first account field.) × Answer is complete but not entirely correct. No date General Journal 1 December 31, 20 Depreciation expense Accumulated depreciation Debit Credit 11,000 x 11,000 x

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter8: Employer Taxes, Payments, And Reports

Section: Chapter Questions

Problem 1A: TruGreen is the worlds largest lawn and landscape company, employing over 10,000 employees and...

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