**Depreciation Expense Calculation for 2022 and 2023**The task involves computing depreciation expense for the years 2022 and 2023 using three different methods:1. **Straight-line Method** - 2022: $4,625 - 2023: $3,3932. **Units-of-activity Method** - 2022: $4,669 - 2023: $3,3933. **Double-declining-balance Method** - 2022: $8,500 - 2023: $6,375### Table Explanation:The table presents the depreciation expenses calculated for each year using the different methods. The expenses for 2022 are listed in the left column, and for 2023 in the right column. The data is displayed in a tabular format with three rows representing each method and two columns for each year's expense values.### Additional Features:- A "Your answer is partially correct" message is displayed at the top.- There are buttons labeled "eTextbook and Media" and "List of Accounts" for additional resources.- A "Save for Later" option is provided.- Users have unlimited attempts to submit their answers, as indicated by the "Attempts: unlimited" message next to the "Submit Answer" button. **Depreciation Calculation for Whispering Winds Corp.****Background Information:**Whispering Winds Corp. purchased a delivery truck for $34,000 on January 1, 2022. The truck has the following characteristics:- Expected salvage value: $5,000- Estimated useful life: 8 years- Estimated mileage: 100,000 miles**Actual Mileage:**- 2022: 16,100 miles- 2023: 11,700 miles**Objective:**Calculate the depreciable cost per mile using the units-of-activity method.**Calculation:**1. **Depreciable Cost:** - Initial Cost: $34,000 - Salvage Value: $5,000 - Total Depreciable Amount: $34,000 - $5,000 = $29,0002. **Depreciation per Mile:** - Total Estimated Mileage: 100,000 miles - Depreciable Cost per Mile: $29,000 / 100,000 miles = $0.29 per mile**Result:**The depreciable cost per mile is $0.29.**Confirmation:**Your answer is correct.**Components of the Image:**- A green confirmation box indicating the correctness of the provided answer.- Instructions specify rounding to two decimal places.- Buttons for accessing additional resources, such as eTextbook and Media, and a List of Accounts.- Unlimited attempts allowed for practice.

Name: **Depreciation Expense Calculation for 2022 and 2023**The task involv
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Description: **Depreciation Expense Calculation for 2022 and 2023**The task involves computing depreciation expense for the years 2022 and 2023 using three different methods:1. **Straight-line Method** - 2022: $4,625 - 2023: $3,3932. **Units-of-activity Meth

Depreciation: Depreciation is a method that reallocates the cost of a tangible asset over its useful life. In accountancy, depreciation refers to how two aspects of the business are affected by one single transaction. Depreciation decreases the value of assets. Depreciation allocates the cost of assets over a period of its useful life and charges it as an expense. The cost of assets is generally the total amount of assets including all the costs related to acquisition and installation. Fixed assets include all long term assets which are acquired for long term purposes. Methods: Methods for calculating depreciation may vary, but treatment for recording depreciation expenses would be the same for all methods. Straight Line Method Declining Balance Method Sum of the Years' Digits Methods Units of Production Method. As we are required to calculate the depreciation as per the straight-line method, units of production method, and double-declining balance method, let us discuss that and move on with our problem. 1. Straight-Line Method: It charges depreciation expenses evenly throughout the life of an asset. This method is appropriate where economic benefits from the assets are expected to be realized evenly over its useful life. Due to its simplicity, this method is commonly used. Formula: Annual Depreciation = (Cost of Asset - Residual Value)/Useful life in years 2. Units of Production Method: It is also known as Units of Activity and Units of Usage Method. This is the method where depreciation is charged to assets in the proportion of usage of assets. Usage can be the number of hours or number of units produced or the number of kilometers or any other activity. In this method, more depreciation is charged where there is more asset usage and less depreciation when there is less usage. This method is useful when there is a significant difference in asset usage from period to period. 3. Double Declining Balance Method: This is a method of accelerated depreciation. This is a method where more depreciation is charged during the beginning of the life of assets and less is charged during the later life of an asset. This method is also known as the 200% declining balance method. Although depreciation will be faster, total depreciation over the life of the asset will not be greater than total depreciation using the straight-line method. Formula: Depreciation Rate = Straight-line depreciation rate*2 Straight-line depreciation rate = (100/Useful life) As discussed earlier, under the straight-line method the depreciation expense amount will be the same for all the years. Let us now calculate the depreciation expense amount under the Straight-Line Method. We are given, The cost of Delivery Truck = $34,000 Salvage Value = $5,000 Useful Life in years = 8 years Therefore, the depreciation expense under the straight-line method is calculated as under: Depreciation Expense = (Cost Value - Salvage Value)/Useful Life = ($34,000 - $5,000)/8 years = $3,625 As per this method, the depreciation is the same for all the useful years. So, the depreciation expense calculated above will be the same for both the years 2022 and 2023. Therefore, the depreciation expense for the year 2022 and 2023 is $3,625. Note: As in the question, the depreciation calculated under the other two methods are correct, it is not solved. If you need the solution for that too, please resubmit the question specifying the requirement.

Business

Accounting

Compute depreciation expense for 2022 and 2023 using (1) the straight-line method, (2) the units-of-activity method, and (3) the double-declining-balance method. Depreciation Expense 2022 2023 (1) Straight-line method $ 4625 3393 (2) Units-of-activity method 4669 2$ 3393 (3) Double-declining-balance method 8500 $ 6375 %24 %24 %24 %24 %24

Compute depreciation expense for 2022 and 2023 using (1) the straight-line method, (2) the units-of-activity method, and (3) the double-declining-balance method. Depreciation Expense 2022 2023 (1) Straight-line method $ 4625 3393 (2) Units-of-activity method 4669 2$ 3393 (3) Double-declining-balance method 8500 $ 6375 %24 %24 %24 %24 %24

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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