Depreciation by units-of-activity Method

Prior to adjustment at the end of the year, the balance in Trucks is $407,900 and the balance in Accumulated DepreciationTrucks is $120,180. Details of the subsidiary ledger are as follows:

Truck No.	Cost	Estimated Residual Value	Estimated Useful Life	Accumulated Depreciation at Beginning of Year	Miles Operated During Year
1	$81,500		$12,225		220,000	miles			33,000	miles
2	119,900		14,388		320,000		$23,980		32,000
3	91,500		12,810		211,000		$73,200		21,100
4	115,000		13,800		400,000		$23,000		48,000

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a. Determine for each truck the depreciation rate per mile and the amount to be credited to the accumulated depreciation section of each subsidiary account for the miles operated during the current year. Keep in mind that the depreciation taken cannot reduce the book value of the truck below its residual value.

Round the rate per mile to two decimal places. Enter all values as positive amounts.

Truck No.	Rate per Mile (in cents)	Miles Operated	Credit to Accumulated Depreciation
1			33,000
2			32,000
3			21,100
4			48,000
			Total

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b. Journalize the entry to record depreciation for the year.

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