On January 1, Year 1, Marino Moving Company paid $48,000 cash to purchase a truck. The truck was expected to have a four-year useful life and an $8,000 salvage value. Marino uses the straight-line method. On January 1, Year 3, Marino’s accounting records contained the following balances: Truck 48,000 Accumulated Depreciation 20,000 Also, on January 1, Year 3 the company paid $10,000 to replace an engine that would extend the useful life of the truck from a total of four years to a total of seven years. Which of the following shows how the engine replacement will affect the account balances after the engine replacement on January 1, Year 3? Multiple Choice Truck 58,000, Accumulated Depreciation 20,000 Truck 48,000, Accumulated Depreciation 20,000 Truck 48,000, Accumulated Depreciation 10,000 Truck 58,000, Accumulated Depreciation 10,000
On January 1, Year 1, Marino Moving Company paid $48,000 cash to purchase a truck. The truck was expected to have a four-year useful life and an $8,000 salvage value. Marino uses the straight-line method. On January 1, Year 3, Marino’s accounting records contained the following balances:
Truck 48,000
Also, on January 1, Year 3 the company paid $10,000 to replace an engine that would extend the useful life of the truck from a total of four years to a total of seven years. Which of the following shows how the engine replacement will affect the account balances after the engine replacement on January 1, Year 3?
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Truck 58,000, Accumulated Depreciation 20,000
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Truck 48,000, Accumulated Depreciation 20,000
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Truck 48,000, Accumulated Depreciation 10,000
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Truck 58,000, Accumulated Depreciation 10,000
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