Determine the annual depreciation expense for an automobile for the years 2010-2013

Demonstration Problem 8-1 On January 1, 2010, Sanders Rental Company (SRC) paid cash to purchase an automobile. The car dealer gave SRC a $1,000 cash discount off the $19,000 list price. However, SRC paid an additional $2,000 to equip the automobile with a more luxurious interior so it would have greater appeal to his clientele. SRC expects the automobile to have a four-year useful life and to lease it for 100,000 miles before disposing of it. SRC also estimates a $4,000 salvage value. SRC leased the automobile to a customer who drove it 30,000: 10,000; 40,000; and 25,000 miles during 2010, 2011, 2012, and 2013, respectively. Required Compute the annual depreciation expense for the automobile for years 2010 through 2013 by completing the format provided and the following depreciation methods. a. Straight-line b. Double-declining balance c. Units of production