Linton Company purchased a delivery truck for $28,000 on January 1, 2017. The tr

Question

Linton Company purchased a delivery truck for $28,000 on January 1, 2017. The truck has an expected salvage value of $2,200, and is expected to be driven 110,000 miles over its estimated useful life of 10 years. Actual miles driven were 12,300 in 2017 and 10,000 in 2018. Collapse question part (a1) Correct answer. Your answer is correct. Calculate depreciation expense per mile under units-of-activity method. (Round answer to 2 decimal places, e.g. 0.52.) Depreciation expense $Entry field with correct answer 0.23 per mile SHOW LIST OF ACCOUNTS SHOW SOLUTION LINK TO TEXT Attempts: 1 of 15 used Collapse question part (a2) Compute depreciation expense for 2017 and 2018 using (1) the straight-line method, (2) the units-of-activity method, and (3) the double-declining-balance method. (Round depreciation cost per unit to 2 decimal places, e.g. 0.50 and depreciation rate to 0 decimal places, e.g. 15%. Round final answers to 0 decimal places, e.g. 2,125.) Depreciation Expense 2017 2018 (1) Straight-line method $ $ (2) Units-of-activity method $ $ (3) Double-declining-balance method $ $

Explanation / Answer

Linton Company Purchased price of truck $ 28,000.00 Salvage Value $   2,200.00 Useful life 10 Years Miles Driven over its useful life 110000 Miles driven in 2017 12300 Miles Miles drivenin 20118 10000 Miles Straight Line Method Formula: (Cost-Salvage Value)/Useful life ($28000-$2000)/10 $   2,600.00 In 2017 ($28000-$2000)/10 $   2,600.00 In 2018 Units of Activity Method Formula:(Cost-Salvage Value)/Total Miles Driven=(28000-2200)/110000 $            0.23 Per Mile Cost per mile= Depreciation in 2017=(12300*.23) $   2,829.00 Depreciation in 2018=(10000*.23) $   2,300.00 Double Declining Method Double Declining Rate=(1/uesful life)*200% 0.2 In 2017=($28000*.20) $   5,600.00 In 2018=($28000-$5600)*.20 $   4,480.00

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