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Question - On January 1, 2019 Ariel's Flowers Limited bought a van for making deliveries for publishing its books for $48,000. The van has a residual value of $2,000 and a useful life of 4 years or 160,000 km. In 2019 the van was driven 40,000km while in 2020 it was driven 45,000km.
Required -
1. Calculate the depreciation expense for 2019 & 2020 using:
a. the double declining balance method
b. the straight-line method
c. the units of production method
2. Prepare the journal entry to record the sale of the printing press assuming the company used the straight-line method of depreciation and sold the van for $26,000 on January 1, 2021.
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