Required information Exercise 7-11A Determine depreciation under three methods (LO7-4) [The following information applies to the questions displayed below.] Speedy Delivery Company purchases a delivery van for $42,400. Speedy estimates that at the end of its four-year service life, the van will be worth $6,400. During the four-year period, the company expects to drive the van 180,000 miles. Actual miles driven each year were 46,000 miles in year 1 and 50,000 miles in year 2. Required: Calculate annual depreciation for the first two years of the van using each of the following methods. (Do not round your intermediate calculations.) Exercise 7-11A Part 1 1. Straight-line. Year 1 2 Exercise 7-11A Part 2 Annual Depreciation 2. Double-declining-balance. Year 1 2 Annual Depreciation Exercise 7-11A Part 3 Year 1 2 3. Activity-based. Annual Depreciation
Required information Exercise 7-11A Determine depreciation under three methods (LO7-4) [The following information applies to the questions displayed below.] Speedy Delivery Company purchases a delivery van for $42,400. Speedy estimates that at the end of its four-year service life, the van will be worth $6,400. During the four-year period, the company expects to drive the van 180,000 miles. Actual miles driven each year were 46,000 miles in year 1 and 50,000 miles in year 2. Required: Calculate annual depreciation for the first two years of the van using each of the following methods. (Do not round your intermediate calculations.) Exercise 7-11A Part 1 1. Straight-line. Year 1 2 Exercise 7-11A Part 2 Annual Depreciation 2. Double-declining-balance. Year 1 2 Annual Depreciation Exercise 7-11A Part 3 Year 1 2 3. Activity-based. Annual Depreciation
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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.
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![Required information
Exercise 7-11A Determine depreciation under three methods (LO7-4)
[The following information applies to the questions displayed below.]
Speedy Delivery Company purchases a delivery van for $42,400. Speedy estimates that at the end of its four-year service
life, the van will be worth $6,400. During the four-year period, the company expects to drive the van 180,000 miles.
Actual miles driven each year were 46,000 miles in year 1 and 50,000 miles in year 2.
Required:
Calculate annual depreciation for the first two years of the van using each of the following methods. (Do not round your
intermediate calculations.)
Exercise 7-11A Part 1
1. Straight-line.
Year
1
2
Exercise 7-11A Part 2
Annual
Depreciation
2. Double-declining-balance.
Year
1
2
Annual
Depreciation
Exercise 7-11A Part 3
Year
1
2
3. Activity-based.
Annual
Depreciation](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc802d839-0afb-4719-afa6-58fb2cdadd5b%2F7e5b491c-5198-4a2c-a1cd-867e325488fc%2Fhpd2eel_processed.png&w=3840&q=75)
Transcribed Image Text:Required information
Exercise 7-11A Determine depreciation under three methods (LO7-4)
[The following information applies to the questions displayed below.]
Speedy Delivery Company purchases a delivery van for $42,400. Speedy estimates that at the end of its four-year service
life, the van will be worth $6,400. During the four-year period, the company expects to drive the van 180,000 miles.
Actual miles driven each year were 46,000 miles in year 1 and 50,000 miles in year 2.
Required:
Calculate annual depreciation for the first two years of the van using each of the following methods. (Do not round your
intermediate calculations.)
Exercise 7-11A Part 1
1. Straight-line.
Year
1
2
Exercise 7-11A Part 2
Annual
Depreciation
2. Double-declining-balance.
Year
1
2
Annual
Depreciation
Exercise 7-11A Part 3
Year
1
2
3. Activity-based.
Annual
Depreciation
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