Question

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CALCULATOR PRINTER VERSION BACK NEXT Exercise 9-7 (Part Level Submission) Wildhorse Co. purchased a delivery truck for $38,000 on January 1, 2019. The truck has an expected salvage value of $2,000, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 14,400 in 2019 and 12,700 in 2020. (al) Your answer is correct. Calculate depreciable cost per mile under units-of-activity method. (Round answer to 2 decimal places, e.g. 0.50.) Depreciable cost 0.36 per mile Click if you would like to Show Work for this question: Open Show Work SHOW LIST OF ACCOUNTS LINK TO TEXT Attempts: 1 of 15 used (a2) Your answer is partially correct. Try again. Compute depreciation expense for 2019 and 2020 using (1) the straight- line method, (2) the units-of-activity method, and (3) the double- declining-balance method. (Round depreciable 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 (1) Straight-line method (2) Units-of-activity method (3) Double-declining balance method 7200 Click if you would like to Show Work for this question: Open Show Work

Answer 1

Units of activity Method Depreciation per mile = ( 38000 - 2000 ) / 100000 = $ 0.36 per mile Depreciation for 2019 = ( 14400 * 0.36 ) = $ 5184 Depreciation for 2020 = ( 12700 * 0.36 ) = $ 4572 Double Declining Balance Method Depreciation Rate = ( 200 / useful life of asset) = ( 200 / 8) = 25% Depreciation for 2019 = 38000 * 25% = $ 9500. Depreciation for 2020 = ( 38000 - 9500) * 25 % = $ 7125.