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E8-9 (Algo) Computing Depreciation under Alternative Methods LO8-3 Assume Organic Ice Cream Company, Inc., bought a new ice cream production kit (pasteurizer/homogenizer, cooler, aging vat, freezer, and filling machine) at the beginning of the year at a cost of $10,000. The estimated useful life was four years, and the residual value was $900. Assume that the estimated productive life of the machine was 9,100 hours. Actual annual usage was 3,640 hours in Year 1; 2,730 hours in Year 2; 1,820 hours in Year 3; and 910 hours in Year 4. Required: 1. Complete a separate depreciation schedule for each of the alternative methods. a. Straight-line. b. Units-of-production. c. Double-declining-balance. Reg 1A Reg 1B Reg 10 Complete a depreciation schedule using the Straight-line method. (Do not round intermediate calculations.) Depreciation Expense $ Year At acquisition 1 2 $ $ 2,275 2,275 2,275 2.275 Accumulated Net Depreciation Book Value $ 10,000 $ 2,275 $ 7,725 $ 4,550 $ 5,450 $ 6,825 $ 3,175 9,100 $ 900 3 $ >> 4 4 Reg 1A Reg 1B Reg 10 Complete a depreciation schedule using the units-of-production method. (Use two decimal places for the per unit output factor. Do not round intermediate calculations.) Depreciation Expense Accumulated Depreciation Year At acquisition 1 2 3 $ $ 3,640 2,730 1,820 910 $ $ $ Net Book Value $ 10.000 $ 6,360 $ 3,630 $ 1,810 900 $ 3,640 6,370 8,190 9,100 $ $ 4 $ $ Reg 1A Reg 1B Reg 1C Complete a depreciation schedule using the double-declining-balance method. (Do not round intermediate calculations.) Net Year At acquisition 1 2 Depreciation Accumulated Expense Depreciation Book Value $ 10,000 $ 5,000 $ 5,000 $ 5,000 $ 2,500 $ 7,500 $ 2,500 $ 1,250 $ 8,750 $ 1,250 $ 625 X $ 9,375 $ 625 $ 3 4

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