Problem 3 (8 points)

The Tree Line Inn has purchased a shuttle bus to transport guests to and from a local ski lodge. The cost of the bus is $40,000; its salvage value is $4,000; and its life is five years with expected usable mileage of 100,000.

1. Straight-line
2. Units of production, assuming the bus traveled 15,000 miles in year 1
3. Sum-of-the-years digits
4. Double declining balance