5 points A truck cost $16,500 with a residual value of $1,500. It has an estimat

Question

5 points A truck cost $16,500 with a residual value of $1,500. It has an estimated useful life of 5 years. If the truck was bought on July 3, what would be the book value at the end of year 1 (use straight-line depreciation)? 1) $12,000 2) $13,500 3) $15,000 4) $14,000 Save Question 15 (5 points) 5 points ABC Electrical Company depreciates its trucks using the units-of-production method. The cost of its new truck was $24,600, the useful life is 125,000 miles, and the trade-in value is $5,250. What is the depreciation expense per mile (to three decimal places)? 1) $0.155 2) $0.165 3) S0.145 4) S0 215 Save Question 16 (5 points) 5 points A truck cost $16,500 with a residual value of $1,500. It has a estimated useful life of 5 years. Using the double declining balance depreciation method, how much depreciation would be taken in the first full year? 1) $3.300 2) 55.500 3) 56.000 4) $6.500

Explanation / Answer

Q14) Straight line dep = (16500-1500/5) = 3000

First year dep = (3000*6/12) = 1500

Book value at the end of first year = (16500-1500) = $15000

so answer is 3) $15000

Q15) Depreciation per mile = (24600-5250)/125000 = 0.155

so answer is 1) $0.155

Q16) Straight line rate = 100/5=20%

Double decline rate = 20*2=40%

First year dep = (16500*40%) = 6600

so answer is 4) $6600

Q9) Delivery truck value = $18000

Payment amount = (260*60+4000) = 19600

Total finance charge = (19600-18000) = 1600

so answer is 1) $1600

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