Question

Yoshi Company completed the following transactions and events involving its delivery trucks. 1.42 points Year 1 Jan. 1 Paid $23,515 cash plus $1,635 in sales tax for a new delivery truck estimated to have a five-year life and a $2,300 salvage value. Delivery truck costs are recorded in the Trucks account. Dec. 31 Recorded annual straight-line depreciation on the truck. Year 2 Dec. 31 The truck's estimated useful life was changed from five to four years, and the estimated salvage value was increased to $2,850. Recorded annual straight-line depreciation on the truck. eBook Year 3 Dec. 31 Recorded annual straight-line depreciation on the truck. Dec. 31 Sold the truck for $5,300 cash. Print Required: 1-a. Calculate depreciation for Year 2. 1-b. Calculate book value and gain (loss) for sale of Truck on December 31, Year 3. 1-c. Prepare journal entries to record these transactions and events. Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 10 Calculate depreciation for Year 2. Total cost Less accumulated depreciation (from Year 1) Book value Less revised salvage value Remaining cost to be depreciated Years of life remaining Total depreciation for Year 2 Required 1A Required 1B >

Answer 1

1-A  

Total Cost	$ 25,150.00
Less: Accumulated Depreciation (Year 1) ((25150-2300)/5)	$    4,570.00
Book Value	$ 20,580.00
Less: Revised Salvage Value	$    2,850.00
Remaining cost to be depreciated	$ 17,730.00
Years of life remaining	4
Total Depreciation for year 2	$    4,432.50

1-B

Book value at beginning of year 3 (20580-4432.50)	$ 16,147.50
Less: Depreciation for year 3	$    4,432.50
book value at end of year 3	$ 11,715.00
Sale	$    5,300.00
Profit / Loss	$ -6,415.00

1-C

Date	Account Title	Debit	Credit
1/1/ year 1	Delivery Truck (23515 + 1635)	$ 25,150.00
	Cash		$ 25,150.00
	(To record purchase of delivery truck)
31/12/ year 1	Depreciation Expense	$    4,570.00
	Accumulated Depreciation		$   4,570.00
	(To record depreciation expense)
31/12/ year 2	Depreciation Expense	$    4,432.50
	Accumulated Depreciation		$   4,432.50
	(To record depreciation expense)
31/12/ year 3	Depreciation Expense	$    4,432.50
	Accumulated Depreciation		$   4,432.50
	(To record depreciation expense)
31/12/ year 3	Cash	$    5,300.00
	Accumulated Depreciation (4570+4432.50+4432.50)	$ 13,435.00
	Loss on sale of Delivery Truck	$    6,415.00
	Delivery Truck		$ 25,150.00
	(To record sale of Delivery truck )