Sarasota Corporation purchased a truck at the beginning of 2017 for $50,100. The

Question

Sarasota Corporation purchased a truck at the beginning of 2017 for $50,100. The truck is estimated to have a residual value of $3,210 and a useful life of 296,000 km. It was driven for 66,000 km in 2017 and 80,000 km in 2018

Calculate depreciation expense for 2017 and 2018 using the unit of production method(Round per km to 4 decimal places, e.g. 15.1254 and round final answers to 0 decimal places, e.g. 5,275.)

Depreciation Expense: 2017 $__________. 2018 $___________.

For tax purposes, the asset is depreciated at a rate of 30%. Calculate the Capital Cost Allowance (CCA) for 2017 and 2018. (Round answers to 0 decimal places, e.g. 5,275.)

Capital Cost Allowance (CCA): 2017 $___________. 2018 $___________.

Sarasota Corporation purchased a truck at the beginning of 2017 for $50,100. The truck is estimated to have a residual value of $3,210 and a useful life of 296,000 km. It was driven for 66,000 km in 2017 and 80,000 km in 2018

Explanation / Answer

Purchase Cost       50,100.00 Residual Value          3,210.00 Depreciable Value       46,890.00 Useful Life (Km)    2,96,000.00 Km in Year 1       66,000.00 Depreciation in Year 1       10,455.20 Km in Year 2       80,000.00 Depreciation in Year 2       12,672.97 Year 1 Opening Value Depreciation@ 30% (CCA) Closing Value 1            50,100.00                      15,030.00          35,070.00 2            35,070.00                      10,521.00          24,549.00

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