On January 1, a company purchases a delivery van for $44,000. The company estimates that at the end of its four-year service life, the van will be worth $7,200. During the four-year period, the company expects to drive the van 184,000 miles. Actual miles driven each year were 48,000 miles in year 1 and 56,000 miles in year 2. Required: Calculate annual depreciation for the first two years using each of the following methods. 1. Straight-line. 2. Double-declining-balance. 3. Activity-based.

On January 1, a company purchases a delivery van for $44,000. The company estimates that at the end of its four-year service life, the van will be worth $7,200. During the four-year period, the company expects to drive the van 184,000 miles. Actual miles driven each year were 48,000 miles in year 1 and 56,000 miles in year 2. Required: Calculate annual depreciation for the first two years using each of the following methods. 1. Straight-line. 2. Double-declining-balance. 3. Activity-based.

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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