On January 1, 2021, Montana Enterprises purchased a $100,000 semi-trailer truck. In 2021 and 2022, Montana depreciated the truck using the straight-line method with an estimated 10-year useful life and an estimated $10,000 salvage value. At the beginning of 2023, Montana decided to adjust the initial estimates. The company now believes the truck will last a total of 15 years and have a salvage value of $17,000.At December 31, 2023, what will be the truck’s adjusted book value reflecting the change in estimate?Multiple Choice:- $73,000- $83,400- $85,000- $77,000

Given information is: Cost of Truck = $100,000 Useful life = 10 years Salvage value = $10,000…

Answered: At December 31, 2023, what will be the…

Business

Accounting

At December 31, 2023, what will be the truck's adjusted book value reflecting the change in estimate?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

On January 1, 2021, Montana Enterprises purchased a $100,000 semi-trailer truck. In 2021 and 2022, Montana depreciated the truck using the straight-line method with an estimated 10-year useful life and an estimated $10,000 salvage value. At the beginning of 2023, Montana decided to adjust the initial estimates. The company now believes the truck will last a total of 15 years and have a salvage value of $17,000.

At December 31, 2023, what will be the truck’s adjusted book value reflecting the change in estimate?

Multiple Choice:

- $73,000
- $83,400
- $85,000
- $77,000

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