E8-9 (Algo) Computing Depreciation under Alternative Methods LO8-3
Plain Ice Cream Co. bought a new ice cream machine at the beginning of the year at a cost of $20,000. The estimated useful life was four years or 9,900 hours of use, and the residual value was $2,180. 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.
Complete a depreciation schedule for each method:
Straight-line
Units-of-production
Double-declining-balance