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CP$9-1($Algo$)$ Computing Acquisition Cost and Recording Depreciation under Three Alternative Methods

$[$LO $9-2,$ LO $9-3]$

$[$The following information applies to the questions displayed below.$]$

At the beginning of the year, Tulip Corporation bought machinery, shelving, and a forklift. The machinery initially cost

$$26,800$ but had to be overhauled $($at a cost of $$1,440)$ before it could be installed $($at a cost of $$720)$ and finally put into

use. The machinery's total life was estimated as $40,000$ hours, with an estimated residual value of $$1,000.$ The machinery

was actually used $5,000$ hours in year $1$ and $7,000$ hours in year $2.$ Repair costs were $$380$ in each year.

The shelving cost $$9,450$ and was expected to last $5$ years, with a residual value of $$630.$ The forklift cost $$12,150$ and

was expected to last six years, with a residual value of $$2,060.$

CP$9-1($Algo$)$ Part $4$

Compute year $2$ straight$-$line depreciation expense for the shelving and give the journal entry to record it$.$

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