Question

On January 1, Year 1, Marino Moving Company paid $48,000 cash to purchase a truck. The truck was expected to have a four year useful life and an $8,000 salvage value. If Marino uses the straight-line method, the journal entry required to recognize depreciation expense at the end of Year 2 is

Answer 1

Answer:

Please check the attached image for the answer.

Explanation:

Depreciation expense using the straight line depreciation method = (Cost of asset - Salvage value) / useful life

($48,000 - $8,000) / 4 = $10,000

The depreciation expense each year is $10,000.

I hope my answer helps you

Answer 2

Answer:

The journal entry required to recognize depreciation expense at the end of Year 2 is:

Debit Depreciation expense $10,000

Credit Accumulated depreciation account $10,000

Explanation:

Marino Moving Company uses straight-line depreciation method, Depreciation Expense each year is calculated by following formula:  

Annual Depreciation Expense = (Cost of truck − Salvage Value )/Useful Life = ($48,000 - $8,000)/4 = $10,000

Depreciation expense for year 2 = $10,000

The journal entry:

Debit Depreciation expense $10,000

Credit Accumulated depreciation account $10,000