Question
Deacon Industries purchased a delivery vehicle on January 1, 2019, for $30,000. They paid sales taxes of $2,000 and one year's insurance premium of
Deacon Industries purchased a delivery vehicle on January 1, 2019, for $30,000. They paid sales taxes of $2,000 and one year's insurance premium of $2,000 on the same day. The company estimated a residual value of $3,000 at the end of the five-year expected service life. Expected usage (in miles) of the new delivery vehicle is as follows: 2019 2020 2021 2022 2023 16,000 22,000 25,000 21,000 16,000 Mileage estimates were based on expected increases in customers and the addition of a second delivery vehicle in 2022. What was depreciation expense of the vehicle in 2021 under the sum-of-the-years'-digits and double- declining balance depreciation methods, respectively?
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South-Western Federal Taxation 2018 Comprehensive
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