Charm Company purchased a new car for use in its business on January 1, 2017. It paid $30,000 for the car. Charm expects the car to have a useful life of four years with an estimated residual value of zero. Charm expects to drive the car as follows:

Year Expected Miles Driven

2017 20,000

2018 45,000

2019 40,000

2020 15,000

Total 120,000

Using the straight-line method of depreciation, calculate the following amounts for the car for each of the four years of its expected life:

a.Depreciation expense

b.Accumulated depreciation balance

c.Book value

Straight-Line Method

Year DepreciationExpense Accumulated Depreciation Book Value

Start

2017

2018

2019

2020

Using the Units-of-Production method of depreciation, calculate the following amounts for the car for each of the four years of its expected life:

a.Depreciation expense

b.Accumulated depreciation balance

c.Book value

Units-of-Production Method

Year DepreciationExpense Accumulated Depreciation Book Value

Start

2017

2018

2019

2020

Using the Double-Declining-Balance method of depreciation, calculate the following amounts for the car for each of the four years of its expected life:

a.Depreciation expense

b.Accumulated depreciation balance

c.Book value

Double-Declining-Balance Method

Year DepreciationExpense Accumulated Depreciation Book Value

Start

2017

2018

2019

2020

Using the Double-Declining-Balance method of depreciation, calculate the following and record the appropriate journal entry assuming all events occurred at end of 2018.

a.Assume the car was involved in an accident, damaged beyond repair, and disposed of.

b.Assume the car was involved in an accident and sold for $1,000.

c.Assume the car was limited edition and resold for $24,000.

Date Account Debit Credit

(a)

12/31/18

Date Account Debit Credit

(b)

12/31/18

Date Account Debit Credit

(c)

12/31/18