1. Linton Company purchased a delivery truck for $S34,000 on January 1, 2014. The truck has an expected salvage value of $2,000, and is expected to be driven 100,000 miles over its estimated useful life of 10 years. Actual miles driven were 19,000 in 2014 and 16,000 in 2015.

Instructions

a) Compute depreciation expense for 2014 and 2015 using

(1) the straight-line method and (1 mark)

(2) the units-of-activity method (1 mark)

(b) Assume that Linton uses the straight-line method, Prepare the journal entry to record 2014 depreciation.