DeliciousDelicious

Fried Chicken bought equipment on

JanuaryJanuary

22?,

20162016?,

for

$ 27 comma 000$27,000.

The equipment was expected to remain in service for four years and to perform

4 comma 2004,200

fry jobs. At the end of the? equipment's useful? life,

DeliciousDelicious

estimates that its residual value will be

$ 6 comma 000.$6,000.

The equipment performed

420420

jobs the first? year,

1 comma 2601,260

the second? year,

1 comma 6801,680

the third? year, and

840840

the fourth year.

Requirements

1.	Prepare a schedule of depreciation? expense, accumulated? depreciation, and book value per year for the equipment under the three depreciation methods. Show your computations. ?Note: Three depreciation schedules must be prepared.
2.	Which method tracks the wear and tear on the equipment most? closely?

Requirement 1. Prepare a schedule of depreciation? expense, accumulated? depreciation, and book value per year for the equipment under the three depreciation methods. 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
		Depreciation for the Year
	Asset	Depreciable		Depreciation		Depreciation	Accumulated	Book
Date	Cost	Cost		Rate		Expense	Depreciation	Value
1-2-2016
12-31-2016			/		=
12-31-2017			/		=
12-31-2018			/		=
12-31-2019			/		=

Before completing the? units-of-production depreciation? schedule, calculate the depreciation expense per unit.

(		-		) /		=	Depreciation per unit
(		-		) /		=

Prepare a depreciation schedule using the? units-of-production method.

Units-of-Production Depreciation Schedule
		Depreciation for the Year
	Asset	Depreciation		Number of		Depreciation	Accumulated	Book
Date	Cost	Per Unit		Units		Expense	Depreciation	Value
1-2-2016
12-31-2016			x		=
12-31-2017			x		=
12-31-2018			x		=
12-31-2019			x		=

Prepare a depreciation schedule using the? double-declining-balance (DDB) method. ?(Enter a? "0" for any items with a zero? value.)

Double-Declining-Balance Depreciation Schedule
		Depreciation for the Year
	Asset	Book		DDB		Depreciation	Accumulated	Book
Date	Cost	Value		Rate		Expense	Depreciation	Value
1-2-2016
12-31-2016			x		=
12-31-2017			x		=
12-31-2018					=
12-31-2019					=

Requirement 2. Which method tracks the wear and tear on the equipment most? closely?

The

?

double-declining-balance

straight-line

units-of-production

method tracks wear and tear most closely.