Granny's Fried Chicken bought equipment on January 2, 2025, for $27,000. The equipment was expected to...

Transcribed Image Text:

Granny's Fried Chicken bought equipment on January 2, 2025, for $27,000. The equipment was expected to remain in service for four years and to operate for 5,250 hours. At the end of the equipment's useful life, Granny's Fried Chicken estimates that its residual value will be $6,000. The equipment operated for 525 hours the first year, 1,575 hours the second year, 2,100 hours the third year, and 1,050 hours the fourth year. Read the requirements. Requirement 1. Prepare a schedule of depreciation expense, accumulated depreciation, and book value per year for the equipment under the three depreciation methods: straight- line, units-of-production, and double-declining-balance. 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 Date Asset Cost Depreciable Useful Depreciation Accumulated Book Cost Life Expense Depreciation Value 1-2-2025 27,000 12-31-2025 12-31-2026 12-31-2027 12-31-2028 + + + + || || || || === Granny's Fried Chicken bought equipment on January 2, 2025, for $27,000. The equipment was expected to remain in service for four years and to operate for 5,250 hours. At the end of the equipment's useful life, Granny's Fried Chicken estimates that its residual value will be $6,000. The equipment operated for 525 hours the first year, 1,575 hours the second year, 2,100 hours the third year, and 1,050 hours the fourth year. Read the requirements. Requirement 1. Prepare a schedule of depreciation expense, accumulated depreciation, and book value per year for the equipment under the three depreciation methods: straight- line, units-of-production, and double-declining-balance. 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 Date Asset Cost Depreciable Useful Depreciation Accumulated Book Cost Life Expense Depreciation Value 1-2-2025 27,000 12-31-2025 12-31-2026 12-31-2027 12-31-2028 + + + + || || || || ===