Question
Having trouble today with accounting practice. In recent years, Avery Transportation purchased three used buses. Because of frequent turnover in the accounting department, a different
Having trouble today with accounting practice.
In recent years, Avery Transportation purchased three used buses. Because of frequent turnover in the accounting department, a different accountant selected the depreciation method for each bus, and various methods were selected. Information concerning the buses is summarized as follows.
Bus | Acquired | Cost | Salvage Value | Useful Life in Years | Depreciation Method | |||||
1 | 1/1/12 | $ 98,400 | $ 6,200 | 5 | Straight-line | |||||
2 | 1/1/12 | 119,000 | 11,500 | 4 | Declining-balance | |||||
3 | 1/1/13 | 80,100 | 8,700 | 4 | Units-of-activity |
For the declining-balance method, the company uses the double-declining rate. For the units-of-activity method, total miles are expected to be 119,000. Actual miles of use in the first 3 years were: 2013, 25,200; 2014, 33,100; and 2015, 31,200.
(A)For Bus #3, calculate depreciation expense per mile under units-of-activity method. (Round answer to 2 decimal places, e.g. $0.50.)
(B) Compute the amount of accumulated depreciation on each bus at December 31, 2014. (Round answers to 0 decimal places, e.g. $2,125.) 2014
Bus 1 $
Bus 2 $
Bus 3 $
(C)If bus 2 was purchased on April 1 instead of January 1, what is the depreciation expense for this bus in 2012 and 2013? (Round answers to 0 decimal places, e.g. $2,125.)
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