Question

Brock Florist Company buys a new delivery truck for ​$30,000. It is classified as a​ light-duty truck. the tax rate is 0.2 a. Calculate the depreciation schedule using a​ five-year life and MACRS depreciation. b. Calculate the remaining book value at the end of year 4 and the termination value​ (aka. cost recovery or after tax salvage​ value) for the delivery truck if the truck can be sold at the end of year 4 ​for$4,000. a. Year 1: Year 2: Year 3: Year 4: Year 5: Year 6: b. Calculate the remaining book value at the end of year 4 and the termination value​ (aka. cost recovery or after tax salvage​ value) at the end of year 4 for the delivery truck. Remaining book value at the end of year 4 is ​$5,184​(Round to the nearest​ dollar.) The termination value​ (cost recovery or after tax salvage​ value) at the endo of year 4 is ​$4,237  ​(Round to the nearest​ dollar.)

Answer 1

Year	Cost	Depreciation rate as per MACRS	Depreciation	Net Book Value
0	30000			30000.00
1	30000	20%	6000.00	24000.00
2	30000	32%	9600.00	14400.00
3	30000	19.20%	5760.00	8640.00
4	30000	11.52%	3456.00	5184.00
5	30000	11.52%	3456.00	1728.00
6	30000	5.76%	1728.00	0.00

After tax salvage value

= 4000 + (5184-4000)*0.2

= 4236.8

= 4237