Crane Ltd. purchased a delivery truck on January 1, 2021, at a cost of $83,920. The truck is expected to have a residual value of$8,070 at the end of its 4-year useful life. Crane has a December 31 year end. Use the diminishing-balance method and assume thedepreciation rate is equal to double the straight-line rate.(a)Calculate the depreciation for each year of the truck's life. (Round answers to O decimal places, e.g. 5,275.)Depreciation expense2021$20222$2023$2024$eTextbook and MediaSave for LaterAttempts: 0 of 3 usedSubmit Answer(b)The parts of this question must be completed in order. This part will be available when you complete the part above.

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Description: Crane Ltd. purchased a delivery truck on January 1, 2021, at a cost of $83,920. The truck is expected to have a residual value of$8,070 at the end of its 4-year useful life. Crane has a December 31 year end. Use the diminishing-balance method and as

The double declining balance (DDB) method is an accelerated depreciation calculation used in…

Answered: Calculate the depreciation for each…

Business

Accounting

Calculate the depreciation for each year of the truck's life. (Roune

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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Concept explainers

Depreciation Methods

The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.

Depreciation Accounting

In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.

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Question

Crane Ltd. purchased a delivery truck on January 1, 2021, at a cost of $83,920. The truck is expected to have a residual value of
$8,070 at the end of its 4-year useful life. Crane has a December 31 year end. Use the diminishing-balance method and assume the
depreciation rate is equal to double the straight-line rate.
(a)
Calculate the depreciation for each year of the truck's life. (Round answers to O decimal places, e.g. 5,275.)
Depreciation expense
2021
$
2022
2$
2023
$
2024
$
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(b)
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