Depreciation by units-of-activity Method Prior to adjustment at the end of the year, the balance in Trucks is $404,300 and the balance in Accumulated Depreciation—Trucks is $118,560. Details of the subsidiary ledger are as follows: Truck No. Cost Estimated Residual Value Estimated Useful Life Accumulated Depreciation at Beginning of Year Miles Operated During Year 1 $84,500 $12,675 230,000 miles — 34,500 miles 2 116,300 13,956 320,000 $23,260 32,000 3 91,000 12,740 200,000 $72,800 20,000 4 112,500 13,500 350,000 $22,500 42,000 a. Determine for each truck the depreciation rate per mile and the amount to be credited to the accumulated depreciation section of each subsidiary account for the miles operated during the current year. Keep in mind that the depreciation taken cannot reduce the book value of the truck below its residual value. Round the rate per mile to two decimal places. Enter all values as positive amounts. Truck No. Rate per Mile (in cents) Miles Operated Credit to Accumulated Depreciation 1 $fill in the blank 8e4767fcbfe401a_1 34,500 $fill in the blank 8e4767fcbfe401a_2 2 $fill in the blank 8e4767fcbfe401a_3 32,000 $fill in the blank 8e4767fcbfe401a_4 3 $fill in the blank 8e4767fcbfe401a_5 20,000 $fill in the blank 8e4767fcbfe401a_6 4 $fill in the blank 8e4767fcbfe401a_7 42,000 $fill in the blank 8e4767fcbfe401a_8 Total $fill in the blank 8e4767fcbfe401a_9 b. Journalize the entry to record depreciation for the year. fill in the blank b4a82ffebff305f_2 fill in the blank b4a82ffebff305f_4

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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Depreciation by units-of-activity Method

Prior to adjustment at the end of the year, the balance in Trucks is $404,300 and the balance in Accumulated Depreciation—Trucks is $118,560. Details of the subsidiary ledger are as follows:

Truck No.	Cost	Estimated Residual Value	Estimated Useful Life	Accumulated Depreciation at Beginning of Year	Miles Operated During Year
1	$84,500		$12,675		230,000	miles	—	34,500	miles
2	116,300		13,956		320,000		$23,260	32,000
3	91,000		12,740		200,000		$72,800	20,000
4	112,500		13,500		350,000		$22,500	42,000

a. Determine for each truck the depreciation rate per mile and the amount to be credited to the accumulated depreciation section of each subsidiary account for the miles operated during the current year. Keep in mind that the depreciation taken cannot reduce the book value of the truck below its residual value.

Round the rate per mile to two decimal places. Enter all values as positive amounts.

Truck No.	Rate per Mile (in cents)	Miles Operated	Credit to Accumulated Depreciation
1	$fill in the blank 8e4767fcbfe401a_1		34,500	$fill in the blank 8e4767fcbfe401a_2
2	$fill in the blank 8e4767fcbfe401a_3		32,000	$fill in the blank 8e4767fcbfe401a_4
3	$fill in the blank 8e4767fcbfe401a_5		20,000	$fill in the blank 8e4767fcbfe401a_6
4	$fill in the blank 8e4767fcbfe401a_7		42,000	$fill in the blank 8e4767fcbfe401a_8
			Total	$fill in the blank 8e4767fcbfe401a_9

b. Journalize the entry to record depreciation for the year.

		fill in the blank b4a82ffebff305f_2
			fill in the blank b4a82ffebff305f_4

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