Brief Exercise 9-04

Oriole Company acquires a delivery truck at a cost of $59,000. The truck is expected to have a salvage value of $17,000 at the end of its 10-year useful life. Compute annual depreciation expense for the first and second years using the straight-line method.

		Year 1		Year 2
Annual depreciation expense		$		$

Brief Exercise 9-06

Pharoah Company acquires a delivery truck at a cost of $60,000. The truck is expected to have a salvage value of $5,000 at the end of its 5-year useful life. Assuming the declining-balance depreciation rate is double the straight-line rate, compute annual depreciation for the first and second years under the declining-balance method.

		Year 1		Year 2
Annual depreciation expense