Question

Concord Corporation purchased a delivery truck for $36,800 on January 1, 2020. The truck has an expected salvage value of $1,800, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 13,500 in 2020 and 13,000 in 2021. Calculate depreciation expense per mile under units-of-activity method. (Round answer to 2 decimal places, e.g. 0.50.) Depreciation expense $ per mile e Textbook and Media List of Accounts Compute depreciation expense for 2020 and 2021 using (1) the straight-line method, (2) the units-of-activity method, and (3) the double-declining- balance method. (Round depreciation cost per unit to 2 decimal places, e.g. 0.50 and depreciation rate to O decimal places, e.g. 15%. Round final answers to O decimal places, e.g. 2,125.) Depreciation Expense 2020 2021 (1) Straight-line method (2) Units-of-activity method (3) Double-declining-balance method $ e Textbook and Media List of Accounts Assume that Concord uses the straight-line method. Prepare the journal entry to record 2020 depreciation. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts. Round answers to 0 decimal places, e.g. 2,125.) Account Titles and Explanation Debit Credit e Textbook and Media List of Accounts Assume that Concord uses the straight-line method. Show how the truck would be reported in the December 31, 2020, balance sheet. (Round answers to 0 decimal places, e.g. 2,125.) Concord Corporation Partial Balance Sheet

Answer 1

Depreciation expenses under units of activity method =($36,800 - $1,800) / 100,000 miles
Depreciation expenses under units of activity method =$35,000 / 100,000 miles =$0.35 per mile
	Depreciation expenses
	2020	2021
1.Straight Line method	$4,375	$4,375
($35,000 / 8 years)
2.Units of activity method	$4,725	$4,550
(13,500 miles*$0.35) (13,000*$0.35)
3.Double Declining balance	$9,200	$6,900
($36,800*25%)
($36,800-$9,200)*25%
Account and explanation	Debit	Credit
Depreciation expenses	$4,375
Accumulated Depreciation-Truck		$4,375
Concord Corporation
Partial Balance Sheet
Delivery Truck-Cost	$36,800
Less:Accumulated Depreciation-Truck	$4,375
	$32,425