On JanuaryJanuary 11?, 20162016?, BriskBrisk Delivery Service purchased a truck
ID: 2536933 • Letter: O
Question
On
JanuaryJanuary
11?,
20162016?,
BriskBrisk
Delivery Service purchased a truck at a cost of
$ 90 comma 000$90,000.
Before placing the truck in? service,
BriskBrisk
spent
$ 2 comma 200$2,200
painting? it,
$ 600$600
replacing? tires, and
$ 6 comma 200$6,200
overhauling the engine. The truck should remain in service for five years and have a residual value of
$ 9 comma 000$9,000.
The? truck's annual mileage is expected to be
21 comma 00021,000
miles in each of the first four years and
16 comma 00016,000
miles in the fifth
yearlong dash—100 comma 000100,000
miles in total. In deciding which depreciation method to? use,
Harold ParkerHarold Parker?,
the general? manager, requests a depreciation schedule for each of the depreciation methods? (straight-line, units-of-production, and? double-declining-balance).Read the requirements
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Requirement 1. Prepare a depreciation schedule for each depreciation? method, showing asset? cost, depreciation? expense, accumulated? depreciation, and asset book value.
Begin by preparing a depreciation schedule using the? straight-line method.
Straight-Line Depreciation Schedule
Depreciation for the Year
Asset
Depreciable
Depreciation
Depreciation
Accumulated
Book
Date
Cost
Cost
Rate
Expense
Depreciation
Value
1-1-2016
12-31-2016
/
=
12-31-2017
/
=
12-31-2018
/
=
12-31-2019
/
=
12-31-2020
/
=
Before completing the? units-of-production depreciation? schedule, calculate the depreciation expense per unit. ?(Round depreciation expense per unit to two decimal? places.)
(
-
) /
=
Depreciation per unit
(
-
) /
=
Prepare a depreciation schedule using the? units-of-production method. ?(Enter the depreciation per unit to two decimal? places, $X.X
Straight-Line Depreciation Schedule
Depreciation for the Year
Asset
Depreciable
Depreciation
Depreciation
Accumulated
Book
Date
Cost
Cost
Rate
Expense
Depreciation
Value
1-1-2016
12-31-2016
/
=
12-31-2017
/
=
12-31-2018
/
=
12-31-2019
/
=
12-31-2020
/
=
Explanation / Answer
2.
Straight-line depreciation schedule Date Asset Depreciable Dereciation Depreciation Accumulated Book Value cost cost * Rate Expense Depreciation 1/1/2016 99000 90000 12/31/2016 99000 90000 / 5 = 18000 18000 81000 12/31/2017 99000 90000 / 5 = 18000 36000 63000 12/31/2018 99000 90000 / 5 = 18000 54000 45000 12/31/2019 99000 90000 / 5 = 18000 72000 27000 12/31/2020 99000 90000 / 5 = 18000 90000 9000 Total / = 90000 Purchase cost of the asset 90000 Painting 2200 Tires 600 Overhauling 6200 Total cost 99000 Salvage value 9000 Depreciable cost * 90000Related Questions
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