Hale Eva Pizza has a Nissan truck that they\'ve owned for 6 years and uses it fo
ID: 2392096 • Letter: H
Question
Hale Eva Pizza has a Nissan truck that they've owned for 6 years and uses it for deliveries on the west side of Oahu. The original purchase price of the truck six years ago was $18,000 and Hale Eva expected to use the truck for ten years at which time they planned to sell it for $3,000. As of the last Balance Sheet date Hale Eva had reported accumulated depreciation of $8,000 on the truck using mileage as a factor in depreciation calculation. What is the current book value of the truck?
$18,000
$10,000
None of the other answers
$8,000
$15,000
A.$18,000
B.$10,000
C.None of the other answers
D.$8,000
E.$15,000
Explanation / Answer
Solution:
Original purchase price = $18000
Accumulated depreciation = $8000
Therefore current book value = purchase price - accumulated depreciation = $18000 - $8000 = $10,000
Hence option B is correct.
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