Buckeye Bus Lines uses the units-of-activity method in depreciating its buses. One bus was purchased on January

Question:

Buckeye Bus Lines uses the units-of-activity method in depreciating its buses. One bus was purchased on January 1, 2012, at a cost of $100,000. Over its 4-year useful life, the bus is expected to be driven 160,000 miles. is expected to be $8,000.
Instructions
(a) Compute the depreciation cost per unit.
(b) Prepare a depreciation schedule assuming actual mileage was: 2012, 40,000; 2013, 52,000; 2014, 41,000; and 2015, 27,000.

Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...