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4. Bravura Ltd. is a cellular network installation company. They own a sizable fleet of service trucks and equipment used in their business. The company
4. Bravura Ltd. is a cellular network installation company. They own a sizable fleet of service trucks and equipment used in their business. The company owns a cherry picker truck that they purchased and started using on January 1, 2014 for $40,000. The estimated useful life of the truck was eight years when it was purchased, and the salvage value was $7,000.
A.) Calculate the annual depreciation expense Bravura must recognize on the truck.
On January 1, 2017, Bravura spends $3,350. This expenditure increases the useful life of the truck by an additional two years. The expenditure has no salvage value.
B.) Calculate the annual depreciation expense Bravura must recognize on the truck for the year ended December 31, 2017.
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