Question

Storm Delivery Company purchased a new delivery truck for $53,400 on April 1, 2016. The truck is expected to have a service life of 5 years or 150,000 miles and a residual value of $4,320. The truck was driven 8,200 miles in 2016 and 11,800 miles in 2017. Storm 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 answers to the nearest dollar.
   1. Straight-line method

      2016	$
      2017	$

   2. Sum-of-the-years'-digits method

      2016	$
      2017	$

   3. Double-declining-balance method

      2016	$
      2017	$

   4. Activity method

      2016	$
      2017	$

2. For each method, what is the book value of the machine at the end of 2016? At the end of 2017?
   (Round your answers to the nearest dollar.)
   1. Straight-line method

      2016	$
      2017	$

   2. Sum-of-the-years'-digits method

      2016	$
      2017	$

   3. Double-declining-balance method

      2016	$
      2017	$

   4. Activity method

      2016	$
      2017	$

Answer 1