Prior to adjustment at the end of the year, the balance in Trucks is $298,988 and...

Prior to adjustment at the end of the year, the balance in Trucks is $298,988 and the balance in Accumulated Depreciation—Trucks is $101,200. Details of the subsidiary ledger are as follows:

		Estimated		Accumulated Depreciation at	Miles Operated
Truck No.	Cost	Residual Value	Useful Life	Beginning of Year	During Year
1	$85,360	$14,940	251,500 miles	—	20,400 miles
2	51,100	6,040	300,400 miles	$14,930	32,500 miles
3	76,450	13,830	202,000 miles	61,330	8,100 miles
4	86,078	22,520	235,400 miles	24,940	22,300 miles

A.	Determine the depreciation rates per mile and the amount to be credited to the accumulated depreciation section of each of the subsidiary accounts for the miles operated during the current year.
B.	Journalize the entry on Dec. 31 to record depreciation for the year. Refer to the Chart of Accounts for exact wording of account titles.

A. Determine the depreciation rates per mile and the amount to be credited to the accumulated depreciation section of each of the subsidiary accounts for the miles operated during the current year.

**Only need help with credit accumulated depreciation**

Truck No.	Rate per Mile	Miles Operated	Credit to Accumulated Depreciation
1	0.28	20,400	5712
2	0.15	32,500	4875
3	0.31	8,100	?????
4	0.27	22,300	6021
Total

B. Journalize the entry on Dec. 31 to record depreciation for the year. Refer to the Chart of Accounts for exact wording of account titles.

Expert Solution

Truck no.	Cost	Residual value	Depreciable value	Useful Life in Miles	Rate per Mile	During the year Miles	Depreciation for the Year	Accumulated Depreciation - Opening	Accumulated Depreciation - Closing
1	85,360	14,940	70,420	251,500	0.28	20,400	5,712	-	5,712
2	51,100	6,040	45,060	300,400	0.15	32,500	4,875	14,930	19,805
3	76,450	13,830	62,620	202,000	0.31	8,100	2,511	61,330	63,841
4	86,078	22,520	63,558	235,400	0.27	22,300	6,021	24,940	30,961
							19,119	101,200	120,319

We will charged normal Depreciation in relation to truck number 3.

Residual value is estimated value use for charging depreciation per mile. We have to check Accumulated depreciation will not exceed the cost of assets. Although after charging depreciation remaining book amount of assets can be lower than residual value.

Accounting Entry:

Accounts Title	Debit	Credit
Depreciation Expense	19,119
Accumulated Depreciation		19,119

ekkarill92 answered 2 years ago

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