Exercise 8-11A Events related to the acquisition, use, and disposal of a tangible plant asset: straight-line depreciation LO 8-2, 8-5

City Taxi Service purchased a new auto to use as a taxi on January 1, Year 1, for $24,100. In addition, City paid sales tax and title fees of $1,130 for the vehicle. The taxi is expected to have a five-year life and a salvage value of $5,780. Required a. Using the straight-line method, compute the depreciation expense for Year 1 and Year 2. b & c. Assume that the taxi was sold on January 1, Year 3, for $20,068. Prepare the general journal entries to record the Year 1 depreciation and sale of the taxi in Year 3.

Req A Reg B and C Using the straight-line method, compute the depreciation expense for Year 1 and Year 2. (Round your answers to the nearest whole dollar amount.) Year 1 Year 2 Depreciation expense View transaction list OX 1 Record depreciation expense. 2 Record entry for sale of taxi and gain on sale. Credit Note : journal entry has been entered Record entry Clear entry View general journal