Dewey Cheatem Co. purchases a truck for $25,000.

The truck has a salvage value of $6,000 and

It is expected to be driven for 125,000 miles.

Cheatem Co uses the units-of-production depreciation method, and in year one it expects to use the truck for 26,000 miles.

In year 2 the truck is driven 30,000. In year three the truck is only driven 10,000.

Calculate the annual depreciation expense.

1. Set up a depreciation schedule showing these column headings: Beginning Book Value, Accumulated Depreciation, Ending Book Value andAannual Depreciation Expense for the year. You only have three years of mileage figures so your schedule will only include 3 years of data.