Vert Ltd. purchased a vehicle on 1 January 20X8 for $106,000 and began to use it immediately. The estimated physical life of the vehicle is 20 years, but the estimated useful life to Vert is 10 years. The vehicle has an estimated residual value of $3,000. The vehicle is anticipated to be driven for 200,000 kilometres, and was driven 51,000 kilometres in 20X8 and 57,000 kilometres in 20X9. Required: 1. Calculate depreciation expense for 20X8 and 20X9 using the straight-line method, units of production, and declining balance using a rate of 50%. 20X8 20X9 Straight-line Units of production Declining balance 2. Repeat requirement 1 assuming that Vert decides that the useful life to Vert is 15 years, after which the residual value will be $11,800, and the total kilometres to be driven is now 300,000. 20X8 20X9 Straight-line Units of production Declining balance
Vert Ltd. purchased a vehicle on 1 January 20X8 for $106,000 and began to use it immediately. The estimated physical life of the vehicle is 20 years, but the estimated useful life to Vert is 10 years. The vehicle has an estimated residual value of $3,000. The vehicle is anticipated to be driven for 200,000 kilometres, and was driven 51,000 kilometres in 20X8 and 57,000 kilometres in 20X9. Required: 1. Calculate depreciation expense for 20X8 and 20X9 using the straight-line method, units of production, and declining balance using a rate of 50%. 20X8 20X9 Straight-line Units of production Declining balance 2. Repeat requirement 1 assuming that Vert decides that the useful life to Vert is 15 years, after which the residual value will be $11,800, and the total kilometres to be driven is now 300,000. 20X8 20X9 Straight-line Units of production Declining balance
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Vert Ltd. purchased a vehicle on 1 January 20X8 for $106,000 and began to use it immediately. The estimated physical life of the vehicle is 20 years, but the estimated useful life to Vert is 10 years. The vehicle has an estimated residual value of $3,000. The vehicle is anticipated to be driven for 200,000 kilometres, and was driven 51,000 kilometres in 20X8 and 57,000 kilometres in 20X9.
Required:
1. Calculate
|
|
|
2. Repeat requirement 1 assuming that Vert decides that the useful life to Vert is 15 years, after which the residual value will be $11,800, and the total kilometres to be driven is now 300,000.
|
|
|
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education