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Shoes Store Company purchased a delivery truck in cash on January 1, 2019 with the following information: a) Purchase price: $..... b) Attorney's fee: $....
Shoes Store Company purchased a delivery truck in cash on January 1, 2019 with the following information: a) Purchase price: $..... b) Attorney's fee: $.... c) Freight in: $.... The truck has its expected useful life of 15 years with expected miles to be driven of 115,000. The truck can be sold for $2,000 after 15 years of usage. Actual miles driven were 12,100 in 2019 and 11,500 in 2020. Required; 1. Fill the dot (.....) with a reasonable amount for given transactions above. (0.5 marks). 2. Prepare journal entry for the transaction on January 1, 2019. (0.25 marks) 3. Compute depreciation expense for 2019 and 2020 using (a) the straight-line method, (b) units of activity method, and (c) the double reducing balance method. (0.25 marks) 4. Which depreciation method do you prefer? Why? (0.5 marks)
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