On

JanuaryJanuary

22,

20182018,

SwiftySwifty

Delivery Service purchased a truck at a cost of

$ 67 comma 000$67,000.

Before placing the truck in service,

SwiftySwifty

spent

$ 2 comma 200$2,200

painting it,

$ 800$800

replacing tires, and

$ 4 comma 700$4,700

overhauling the engine. The truck should remain in service for five years and have a residual value of

$ 5 comma 100$5,100.

The truck's annual mileage is expected to be

20 comma 00020,000

miles in each of the first four years and

12 comma 80012,800

miles in the fifth

yearlong dash92 comma 80092,800

miles in total. In deciding which depreciation method to use,

Jordan LipnikJordan Lipnik,

the general manager, requests a depreciation schedule for each of the depreciation methods (straight-line, units-of-production, and double-declining-balance).Read the requirements

LOADING...

.

Requirement 1. Prepare a depreciation schedule for each depreciation method, showing asset cost, depreciation expense, accumulated depreciation, and asset book value.

Begin by preparing a depreciation schedule using the straight-line method.

Straight-Line Depreciation Schedule
		Depreciation for the Year
	Asset	Depreciable		Useful		Depreciation	Accumulated	Book
Date	Cost	Cost		Life		Expense	Depreciation	Value
1-2-2018	$74,700							$74,700
12-31-2018		$69,600	/	5 years	=	$13,920	$13,920	60,780
12-31-2019		69,600	/	5 years	=	13,920	27,840	46,860
12-31-2020		69,600	/	5 years	=	13,920	41,760	32,940
12-31-2021		69,600	/	5 years	=	13,920	55,680	19,020
12-31-2022		69,600	/	5 years	=	13,920	69,600	5,100

Before completing the units-of-production depreciation schedule, calculate the depreciation expense per unit. Select the formula, then enter the amounts and calculate the depreciation expense per unit. (Round depreciation expense per unit to two decimal places.)

(	Cost	-	Residual value	) /	Useful life in units	=	Depreciation per unit
(	$74,700	-	$5,100	) /	92,800	=	$0.75

Prepare a depreciation schedule using the units-of-production method. (Enter the depreciation per unit to two decimal places, $X.XX.)

Units-of-Production Depreciation Schedule
		Depreciation for the Year
	Asset	Depreciation		Number of		Depreciation	Accumulated	Book
Date	Cost	Per Unit		Units		Expense	Depreciation	Value
1-2-2018	$74,700							$74,700
12-31-2018		$0.75	x	20,000	=	$15,000	$15,000	59,700
12-31-2019		0.75	x	20,000	=	15,000	30,000	44,700
12-31-2020		0.75	x	20,000	=	15,000	45,000	29,700
12-31-2021		0.75	x	20,000	=	15,000	60,000	14,700
12-31-2022		0.75	x	12,800	=	9,600	69,600	5,100

Prepare a depreciation schedule using the double-declining-balance (DDB) method. (Round depreciation expense to the nearest whole dollar.)

Double-Declining-Balance Depreciation Schedule
		Depreciation for the Year
	Asset	Book		DDB		Depreciation	Accumulated	Book
Date	Cost	Value		Rate		Expense	Depreciation	Value
1-2-2018	74700
12-31-2018		74700	x	2 x (1/5)	=
12-31-2019			x	2 x (1/5)	=
12-31-2020			x	2 x (1/5)	=
12-31-2021			x	2 x (1/5)	=
12-31-2022

Choose from any list or enter any number in the input fields and then click Check Answer.