Larry Corp. purchased a special custom-made vehicle on April 1, 2019 which cost $500,000. The estimated...

Larry Corp. purchased a special custom-made vehicle on April 1, 2019 which cost $500,000. The estimated residual value is $20,000 and expected life is eight years. The company has a December 31 year end. The vehicle is expected to drive 125,000 kms in year one, 135,000 kms in year two, 155,000 kms in year three and 130,000 kms every year thereafter. The estimated total kms for this vehicle is 1,000,000 kms.

Required

Calculate the depreciation expense by each of the following methods:

Round all values to the nearest dollar.

a) Straight-line for 2019
b) Declining-balance for 2020
c) Units of Output for 2021

Expert Solution

ekkarill92 answered 1 year ago

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