On March 31, 2011, Wild Flowers purchases a delivery van for $30,000, which it e
ID: 2435235 • Letter: O
Question
On March 31, 2011, Wild Flowers purchases a delivery van for $30,000, which it expects to use for 5 years, during which time it expects to drive the van about 100,000 miles. At the end of the 5 years it is expected that the van will be sold for $2,000. During 2011 the van was driven 12,000 miles, and in 2012 it was driven 25,000 miles. Assume Wild Flowers only prepares annual financial statements, and that their year-end is the calendar year-end (i.e. December 31).
Calculate the amount which would appear on the December 31, 2012 [i.e. year 2] balance sheet for Accumulated Depreciation for the van if Wild Flowers used the units-of-production method to depreciate the van.
a. $7,000
b. $9,520
c. $11,000
d. $10,360
Explanation / Answer
Calculate the amount which would appear on the December 31, 2012 [i.e. year 2] balance sheet for Accumulated Depreciation for the van if Wild Flowers used the units-of-production method to depreciate the van. d. $10,360
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