Note: All your answers are correct.
Answer:
a | 2018 Depreciation | $4,330 | per year |
2019 Depreciation | $4,330 | per year | |
b | Gain | on sale | $2,882 |
Explanation:
Cost of asset = Purchase cost + Sales tax = $27,100 + $770 = $27,870
a. Depreciation per year as per year SLM (for 2018 & 2019)
= ( Cost of asset - Salvage value ) / Expected useful life
= ( $27,870 - $6,220) / 5 years = $4,330 per year
b. Accumulated depreciation as on Jan 1 , 2020 = $4,330 * 2 years = $8,660
Gain on sale = Sales value - (Cost of asset - Accumulated depreciation as on Jan 1 , 2020)
= $22,092 - ($27,870 - $8,660)
= $2,882
I just need someone to check if I did this correctly. City Taxi Service purchased a...
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