Sunland Company purchased a delivery truck for $36,000 on January 1, 2022. The truck has an expected salvage value of $6,000, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 12,200 in 2022 and 11.200 in 2023 Calculate depreciable cost per mile under units-of-activity method. (Round answer to 2 decimal places, e.g.0.50.) Depreciable cost eTextbook and Media List of Accounts (1) Compute depreciation expense for 2022 and 2023 using (1) the straight-line method, (2) the units-of-activity method, and (3) the double-declining-balance method. (2) (3) Straight-line method Units-of-activity method Double-declining-balance method eTextbook and Media 03 List of Accounts per mile $ 2022 Depreciation Expense 3750 3660 9000 2023 3750 3360 6750
Sunland Company purchased a delivery truck for $36,000 on January 1, 2022. The truck has an expected salvage value of $6,000, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 12,200 in 2022 and 11.200 in 2023 Calculate depreciable cost per mile under units-of-activity method. (Round answer to 2 decimal places, e.g.0.50.) Depreciable cost eTextbook and Media List of Accounts (1) Compute depreciation expense for 2022 and 2023 using (1) the straight-line method, (2) the units-of-activity method, and (3) the double-declining-balance method. (2) (3) Straight-line method Units-of-activity method Double-declining-balance method eTextbook and Media 03 List of Accounts per mile $ 2022 Depreciation Expense 3750 3660 9000 2023 3750 3360 6750
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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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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Transcribed Image Text:Sunland Company purchased a delivery truck for $36,000 on January 1, 2022. The truck has an expected salvage value of $6,000, and
is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 12,200 in 2022 and 11,200 in
2023
Calculate depreciable cost per mile under units-of-activity method. (Round answer to 2 decimal places, e.g.0.50.)
Depreciable cost
eTextbook and Media
List of Accounts
Compute depreciation expense for 2022 and 2023 using (1) the straight-line method, (2) the units-of-activity method, and (3) the
double-declining-balance method.
(2)
(3)
Straight-line method
Units-of-activity method
Double-declining-balance method
eTextbook and Media
03 per mile
List of Accounts
$
2022
Depreciation Expense
3750
3660
9000
2023
3750
3360
6750
Transcribed Image Text:Assume that Sunland uses the straight-line method. Prepare the journal entry to record 2022 depreciation. (Credit account titles
are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles
and enter O for the amounts.)
Account Titles and Explanation
eTextbook and Media
List of Accounts
eTextbook and Media
List of Accounts
Debit
Assume that Sunland uses the straight-line method. Show how the truck would be reported in the December 31, 2022, balance
sheet.
Sunland Company
Partial Balance Sheet
Credit
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