On January 1 of the current year (Year 1), CVX acquired a delivery van for $68,000. The estimated useful life of the van is 6 years or 120,000 miles. The residual value at the end of 6 years is estimated to be $8,000. The actual mileage for the van was 19,000 miles in Year 1 and 25,000 miles in Year 2. What is the depreciation expense for the second year of use (Year 2) if CVX uses the units of production method? Provide answer

On January 1 of the current year (Year 1), CVX acquired a delivery van for $68,000. The estimated useful life of the van is 6 years or 120,000 miles. The residual value at the end of 6 years is estimated to be $8,000. The actual mileage for the van was 19,000 miles in Year 1 and 25,000 miles in Year 2. What is the depreciation expense for the second year of use (Year 2) if CVX uses the units of production method? Provide answer

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 4EB: Montello Inc. purchases a delivery truck for $25,000. The truck has a salvage value of $6,000 and is...

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Montello Inc. purchases a delivery truck for $25,000. The truck has a salvage value of $6,000 and is expected to be driven for 125,000 miles. Montello uses the units-of-production depreciation method, and in year one it expects to use the truck for 26,000 miles. Calculate the annual depreciation expense.
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