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Calculate annual depreciation expense for the first year

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Reference no: EM132471989

Sandhill Pants Company acquires a delivery truck on April 6, 2017, at a cost of $42,320. The truck is expected to have a residual value of $4,670 at the end of its 4-year useful life. Assume that the company has a policy of recording a half-year's depreciation in the year of acquisition and a half-year's depreciation in the year of disposal.

Question 1: Using the double diminishing-balance method, calculate the depreciation expense for each year of the equipment's life. ( Round depreciation rate to 2 decimal places for all calculations, e.g. 33.33% and round answers to 0 decimal places, e.g. 5,276.)

Depreciation - 2017

Depreciation - 2018

Depreciation - 2019

Depreciation - 2020

Sheridan Pants Company acquires a delivery truck on April 6, 2017, at a cost of $43,260. The truck is expected to have a residual value of $5,110 at the end of its 4-year life. Sheridan uses the nearest month method to pro-rate depreciation expense.

Question 2: Calculate annual depreciation expense for the first and second years using straight-line depreciation, assuming Sheridan has a calendar year end. ( Round answers to 0 decimal places, e.g. 5,250.)

Depreciation - 2017

Depreciation - 2018

Speedy Taxi Service uses the units-of-production method in calculating depreciation on its taxicabs. Each cab is expected to be driven 551,600 km. Taxi 10 cost $39,140 and is expected to have a residual value of $4,050. Taxi 10 is driven 90,800 km in 2016, and 136,700 km in 2017.

Question 3 (a) Calculate the depreciable amount per kilometre. (Round depreciable amount per unit to 3 decimal places, e.g. 5.276.) Depreciable cost per kilometre /km.

Question 3 (b) Calculate the depreciation expense for 2016 and 2017. (Round answers to 0 decimal places, e.g. 5,276.)

Depreciation - 2016

Depreciation - 20175

Wildhorse Company acquires equipment at a cast of $50,000 on January 3, 2017. Management estimates the equipment will have a residual value of $7,000 at the end of its 4-year useful life.

Question 4: Assume that the company uses the diminishing-balance method and that the diminishing-balance depreciation rate is double the straight-line rate. Calculate the depreciation expense for each year of the equipment‘s life. (Round answers to 0 decimal places, 2.9. 5,275.) Depreda?on - 2017 $ Depreciation - 2013 $ Depreda?on - 2019 $ Depreciation - 2020 $

Reference no: EM132471989

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