Question

Exercise 7-50 (Algorithmie) Depreciation Methods Quick-as-Lightning, a delivery service, purchased a new delivery truck for $40,000 on January 1, 2019. The truck is expected to have miles and an expected residual value of $3,000. The truck was driven 15,000 miles in 2019 and 12,300 miles in 2020 us e of ten years or 150,000 Required: 1. Compute depreciation experse for 2019 and 2020 using the a. Straight-line method Depreciation expense: 3,700 per year b. Double-declining balance method Depreciation Expense $ 3,000 2019 2020 $ 6,400 C. Units-of-production method. (Do not round intermediate calculations required, round your answers to the nearest while dollar) 2019 Depreciation Expense $ 3,700 3,034 2020 2. For each method, what is the book value of the machine at the end of 20197 At the end of 20207 Round your answers to the nearest dollar 2019 2020 Straight-line method $ 36,300 32,600 . Double-dedining balance method $ 32,000 25,600 c. Units-of-production method 36,300 $ 33,266

Answer 1

Note:- 1st part of the question is already solved, so i have solved the 2nd part of question as required in the question. If you have any doubt, kindly as in comment.

Requirement 1. a. Straight-line Method Depreciation Expenses $4,875 |($40,000- $1,000) / 8 Depreciation: per year 2020 2019 b. Double-declinig-balance method $10,000 $7,500 1/8)*2*$40,000 ((1/8)*2} * ($40,000-$7,500) C. Unit-of-Production Method $3,900 $3,198 $1,000) * 1 ($40,000- $1,000) * 12,300 units /150,000 units ($40,000 2020 Requirement. B 2019 a. Straight-line Method $35,125 $30,250 ($40,000 $4,875) $30,000 ($35,125-$4,875) a. Double-declinig-balance method $22,500 ($40,000- $10,000) ($30,000- $7,500) C. Unit-of-Production Method $36,100 $32,902 ($40,000- $3,900) ($36,100-$3,198)