Question
In recent years, Oriole Transportation purchased three used buses. Because of frequent turnover in the accounting department, a different accountant selected the depreciation method for
In recent years, Oriole 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 shown as follows.
Bus | Acquired | Cost | Salvage Value | Useful Life in Years | Depreciation Method | |||||
1 | 1/1/18 | $ 95,200 | $ 6,500 | 4 | Straight-line | |||||
2 | 1/1/18 | 124,000 | 11,000 | 4 | Declining-balance | |||||
3 | 1/1/19 | 89,140 | 8,500 | 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 126,000. Actual miles of use in the first 3 years were 2019, 24,000; 2020, 33,000; and 2021, 29,000.
If Bus 2 was purchased on April 1 instead of January 1, what is the depreciation expense for this bus in (1) 2018 and (2) 2019? (Round answers to 0 decimal places, e.g. 2,125.)
(1) 2018 | (2) 2019 | |||
Depreciation expense | $ | $ |
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