Concord Company purchased a delivery truck for $29,000 on January 1, 2022. The truck has an expected salvage value of $1,000, and is expected to be driven 100,000 miles over its estimated useful life of 10 years. Actual miles driven were 12,300 in 2022 and 13,200 in 2023. Calculate depreciation expense per mile under units-of-activity method. (Round answer to 2 decimal places, e.g. 0.50.) Depreciation expense $enter the depreciation expense in dollars per mile rounded to 2 decimal places per mile 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. (Round depreciation cost per unit to 2 decimal places, e.g. 0.50 and depreciation rate to 0 decimal places, e.g. 15%. Round final answers to 0 decimal places, e.g. 2,125.) Depreciation Expense 2022 2023 (1) Straight-line method $enter a dollar amount $enter a dollar amount (2) Units-of-activity method $enter a dollar amount $enter a dollar amount (3) Declining-balance method $enter a dollar amount $enter a dollar amount 1. Assume that Concord uses the straight-line method. Prepare the journal entry to record 2022 depreciation. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) 2. Assume that Concord uses the straight-line method. Show how the truck would be reported in the December 31, 2022, balance sheet.
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.
| Depreciation expense | $enter the depreciation expense in dollars per mile rounded to 2 decimal places | per mile |
Compute depreciation expense for 2022 and 2023 using (1) the straight-line method, (2) the units-of-activity method, and (3) the double-declining-balance method. (Round depreciation cost per unit to 2 decimal places, e.g. 0.50 and depreciation rate to 0 decimal places, e.g. 15%. Round final answers to 0 decimal places, e.g. 2,125.)
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Depreciation Expense
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2022
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2023
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(1)
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Straight-line method
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$enter a dollar amount | $enter a dollar amount | |||
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(2)
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Units-of-activity method
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$enter a dollar amount | $enter a dollar amount | |||
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(3)
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Declining-balance method
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$enter a dollar amount | $enter a dollar amount |
1. Assume that Concord uses the straight-line method. Prepare the
2. Assume that Concord uses the straight-line method. Show how the truck would be reported in the December 31, 2022,
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