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Chubbyville purchases a delivery van for $22,900. Chubbyville estimates a four-year service life and a residual value of $1,800. During the four-year period, the company
Chubbyville purchases a delivery van for $22,900. Chubbyville estimates a four-year service life and a residual value of $1,800. During the four-year period, the company expects to drive the van 109,000 miles. Calculate annual depreciation for the four-year life of the van using each of the following methods.
2. Double-declining-balance. (Round your depreciation rate to 2 decimal places. Round your final answers to the nearest whole dollar.) Year End of Year Amounts Depreciation Accumulated Expense Depreciation $ 22,900 Book Value 1 2 3 4 Total $ 22,900 3. Actual miles driven each year were 19,000 miles in Year 1; 29,000 miles in Year 2; 21,000 miles in Year 3; and 25,000 miles in Year 4. Note that actual total miles of 94,000 fall short of expectations by 15,000 miles. Calculate annual depreciation for the four-year life of the van using activity-based. (Round your depreciation rate to 2 decimal places.) End of Year Amounts Depreciation Accumulated Expense Depreciation Year Book Value 1 2 3 4 Total $ 0Step by Step Solution
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