| I haven't finished the other parts of the question yet but here it is. | Nicoles Getaway Spa (NGS) purchased a hydrotherapy tub system to add to the wellness programs at NGS. The machine was purchased at the beginning of the year at a cost of $22,500. The estimated useful life was five years and the residual value was $500. Assume that the estimated productive life of the machine is 10,000 hours. Expected annual production was year 1, 2,450 hours; year 2, 2,400 hours; year 3, 2,000 hours; year 4, 2,150 hours; and year 5, 1,000 hours. | 1. | Complete a depreciation schedule for each of the alternative methods. (Do not round intermediate calculations. Round your final answers to the nearest dollar amount.) (This table is compete). | | | | | Year | Depreciation Expense | Accumulated Depreciation | Book Value | | At Acquisition | | | $22,500 | | Year 1 | $4,400 | $4,400 | $18,100 | | Year 2 | $4,400 | $8,800 | $13,700 | | Year 3 | $4,400 | $13,200 | $9,300 | | Year 4 | $4,400 | $17,600 | $4,900 | | Year 5 | $4,400 | $22,000 | $500 | | | b. | Units-of-production. | | | | | Year | Depreciation Expense | Accumulated Depreciation | Book Value | | At Acquisition | | | $22,500 | | Year 1 | $5,390 | $5,390 | $17,110 | | Year 2 | $5,280 | | | | Year 3 | $4,400 | | | | Year 4 | $4,730 | | | | Year 5 | $2,200 | | | | | c. | Double-declining-balance. | | | | | Year | Depreciation Expense | Accumulated Depreciation | Book Value | | At Acquisition | | | $22,500 | | Year 1 | $9,000 | $9,000 | $13,500 | | Year 2 | $3,600 | | | | Year 3 | | | | | Year 4 | | | | | Year 5 | | | | | | 2. | Assume NGS sold the hydrotherapy tub system for $6,750 at the end of year 3. Prepare the journal entry to account for the disposal of this asset under the three different methods. (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Round your final answers to the nearest dollar amount.) Record the disposal of the hydrotherapy tub system for $6,750 in year 3 assuming depreciation was calculated using the straight line method. 2 Record the disposal of the hydrotherapy tub system for $6,750 in year 3 assuming depreciation was calculated using the units-of-production method. 3 Record the disposal of hydrotherapy tub system for $6,750 in year 3 assuming depreciation was calculated using the double-declining method. | 3. | The following amounts were forecast for year 3: Sales Revenues $60,000; Cost of Goods Sold $47,000; Other Operating Expenses $4,600; and Interest Expense $900. Create an income statement for year 3 for each of the different depreciation methods, ending at Income before Income Tax Expense. (Don't forget to include a loss or gain on disposal for each method.). (Do not round intermediate calculations. Round your answers to the nearest dollar amount.) | | | | | NICOLE'S GETAWAY SPA | | (Forecasted) Income Statement | | For the Year Ended Year 3 | | | Straight Line | Units-of- Production | Double-Declining Balance | | Sales Revenue | $60,000 | $60,000 | $60,000 | | Cost of Goods Sold | 47,000 | 47,000 | 47,000 | | | 13,000 | 13,000 | 13,000 | | Operating Expenses: | | | | | | | | | | | | | | | | | | | | | | | | | Total Operating Expenses | 0 | 0 | 0 | | | | | | | | | | | | | | | | | | 0 | 0 | 0 | | | | | | | | | |
