Reference no: EM132718989
Question - In recent years, Sarasota Transportation purchased three used buses. Because of frequent turnover in the accounting department, a different accountant selected the depreciation method for each bus, and various methods were selected. Information concerning the buses is summarized as follows.
|
Bus
|
Acquired
|
Cost Salvage
|
Value Useful
|
Life in Years
|
Depreciation Method
|
|
1
|
1/1/18
|
$99,300
|
$7,500
|
4
|
Straight-line
|
|
2
|
1/1/18
|
126,000
|
11,500
|
4
|
Declining-balance
|
|
3
|
1/1/19
|
91,100
|
8,500
|
4
|
Units-of-activity
|
For the declining-balance method, the company uses the double-declining rate. For the units-of-activity method, total miles are expected to be 118,000. Actual miles of use in the first 3 years were 2019, 27,000; 2020, 34,500; and 2021, 32,500.
Depreciation expense= $0.70 per unit
The amount of accumulated depreciation on each bus at December 31, 2020.
BUS 1=$68850
BUS 2=$110250
BUS 3=$43050
If Bus 2 was purchased on April 1 instead of January 1, what is the depreciation expense for this bus in (1) 2018 and (2) 2019?