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Speedy Delivery Service, Inc. has always rented their delivery truck. Speedy declded the rented delivery truck by purchasing a new truck. The following are the facts for the new truck Speedy just purchased: repiace . March 1, 2021 $64,800 Date on which truck was purchased Purchase price .. Method of payment Estimated life Estimated value at the end of 6 years Cash 6 years $0 Depreciation method Straight-Line The following is a partial list of the accounts in Speedy's General Ledger. These are the only accounts you need for this problem.

Speedy Delivery Service, Inc. has always rented their delivery truck. Speedy declded the rented delivery truck by purchasing a new truck. The following are the facts for the new truck Speedy just purchased: repiace . March 1, 2021 $64,800 Date on which truck was purchased Purchase price .. Method of payment Estimated life Estimated value at the end of 6 years Cash 6 years $0 Depreciation method Straight-Line The following is a partial list of the accounts in Speedy's General Ledger. These are the only accounts you need for this problem.

FINANCIAL ACCOUNTING
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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Speedy Delivery Service, Inc. has always rented their delivery truck. Speedy decided to replace the rented delivery truck by purchasing a new truck. The following are the facts for the new truck Speedy just purchased: Date on which truck was purchased Purchase price Method of payment March 1, 2021 $64,800 Cash Estimated life Estimated value at the end of 6 years Depreciation method 6 years $0 Straight-Line The following is a partial list of the accounts in Speedy's General Ledger. These are the only accounts you need for this problem. D Cash D Truck (asset account) D Accumulated Depreciation - Truck D Depreciation Expense Prepare the General Journal entry to record the purchase of the new delivery truck on March 1, 2021. Calculate the amount of monthly depreciation for the new truck. Problem 7-1 to Prepare the March 31 General Journal adjusting entry to record depreciation for the month. What would be the balance in the Accumulated Depreciation–Truck account after the 18th month's depreciation adjusting entry has been made? If Speedy had estimated that the life of the truck was 4 years, what would have been the amount of monthly depreciation?
Transcribed Image Text:Speedy Delivery Service, Inc. has always rented their delivery truck. Speedy decided to replace the rented delivery truck by purchasing a new truck. The following are the facts for the new truck Speedy just purchased: Date on which truck was purchased Purchase price Method of payment March 1, 2021 $64,800 Cash Estimated life Estimated value at the end of 6 years Depreciation method 6 years $0 Straight-Line The following is a partial list of the accounts in Speedy's General Ledger. These are the only accounts you need for this problem. D Cash D Truck (asset account) D Accumulated Depreciation - Truck D Depreciation Expense Prepare the General Journal entry to record the purchase of the new delivery truck on March 1, 2021. Calculate the amount of monthly depreciation for the new truck. Problem 7-1 to Prepare the March 31 General Journal adjusting entry to record depreciation for the month. What would be the balance in the Accumulated Depreciation–Truck account after the 18th month's depreciation adjusting entry has been made? If Speedy had estimated that the life of the truck was 4 years, what would have been the amount of monthly depreciation?
Purchase and Depreciate a New Delivery Truck -- March 1 truck purchase Date Account Name Debit Credit Monthly depreciation . March 31 depreciation adjusting entry Date Account Name Debit Credit Balance in "Accumulated Depreciation - Truck" after 18 months Cre T0-- Monthly depreciation if life was 4 years
Transcribed Image Text:Purchase and Depreciate a New Delivery Truck -- March 1 truck purchase Date Account Name Debit Credit Monthly depreciation . March 31 depreciation adjusting entry Date Account Name Debit Credit Balance in "Accumulated Depreciation - Truck" after 18 months Cre T0-- Monthly depreciation if life was 4 years
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