Depreciation for Partial Perlods Sampson Delivery Company purchased a new delive

Question

Depreciation for Partial Perlods Sampson Delivery Company purchased a new delivery truck for $52,200 on April 1, 2016. The truck is expected to have a service life of 5 years or 157,200 miles and a residual value of $4,920. The truck was driven 10,000 miles in 2016 and 12,200 miles in 2017. Sampson computes depreciation to the nearest whole month. Required: 1. Compute depreciation expense for 2016 and 2017 using the For interim computations, carry amounts out to two decimal places. Round your final answer to the nearest dollar. a. Straight-line method 2016 s I 2,2 X 2017 $2.9 × b. Sum-of-the-years-digits method 2016 $14,0 × 2017s 4,8 X c. Double-declining-balance method × × 2016 $ | 5,3 2017$16,0 d. Activity method 2016 s 2,1 X × 2017 $12,7 2. For each method, what is the book value of the machine at the end of 20167 At the end of 20177 (Round your answers to the nearest dolar.) a. Straight-line method 2016 33, × 2017s 30, X b. Sum-of-the-years'-digits method 2016 san) 2017 5 c. Double-declining-balance method 2016$(30, 20175 | 24" × x d. Activity method 20153133,1 ×

Explanation / Answer

Straight line method:

Depreciation expense = $52200 - $4920 / 5 years

= $9456

2016, depreciation expense = $9456

2017, depreciation expense = $9456.

Sum of years digits method:

Sum of years digits = 5(5+1)/2

= 15

Depreciation base = $52200 - $4920

= $47280

2016 depreciation expense = $47280 * 5/15

= $15760.

2017, depreciation expense = $47280 * 4/15

= $12608.

Double declining balance method:

Straight line depreceiation percent = 100% / 5 = 20%

Straight line depreciation rate = 2 * 20% = 40%

2016, depreciation expense = $52200 * 40%

= $20880

2016, depreciation expense = ($52200 - $20880) * 40%

= $12528.

Units of activity method:

Depreciation = $52200 - $4920 / 157200 miles

= $0.30

2016, depreciation expense = 10000 miles * $0.30

= $3000

2017, depreciation expense = 12200 miles * $0.30

= $3660.

Related Questions

Navigate

• Browse (All)
• Browse D
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.