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Exercise: 4 The following data for a small delivery truck purchased by Barb's Florists on January 1, 2005. Cost $13,000 Expected salvage value $1000 Estimated

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Exercise: 4 The following data for a small delivery truck purchased by Barb's Florists on January 1, 2005. Cost $13,000 Expected salvage value $1000 Estimated useful life years) 5 Estimated useful life(miles) 100,000 Miles driven: Y1 15,000 miles, Y2 30,000 miles, Y3 20,000 miles, Y4 25,000, Y5 10,000 Instructions: Calculate depreciation expenses for first year, and prepare the depreciation schedule for the estimated useful life using units of activity method. Depreciation schedule: Year Units of activity *Depreciation rate Annual Accumulated **Book depreciation depreciation value X x 2005 2006 2007 2008 X X 2009 *Depreciation rate ($13,000 - 1.000) / 100,000 miles = 0.12 ** Book value - original cost. accumulated depreciation

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