A light truck is purchased on January 1 at a cost of $25,000. It is expected to serve for eight years and have a salvage value of $3,000. It is expected to be used for 96,000 miles over its eight-year useful life. Using the units-of-production method, calculate the depreciation expense for the first and third years of use if the truck is driven 20,000 miles in year 1 and 18,000 miles in year 3. Round interim calculations to two decimal places.
A light truck is purchased on January 1 at a cost of $25,000. It is expected to serve for eight years and have a salvage value of $3,000. It is expected to be used for 96,000 miles over its eight-year useful life. Using the units-of-production method, calculate the depreciation expense for the first and third years of use if the truck is driven 20,000 miles in year 1 and 18,000 miles in year 3. Round interim calculations to two decimal places.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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