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 $20,000. The estimated useful life was four years, and the residual value was $2,180. Assume that the estimated productive life of the machine was 9,900 hours. Actual annual usage was 3,960 hours in Year 1; 2,970 hours in Year 2; 1,980 hours in Year 3; and 990 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.