Question

Cullumber Company purchased a delivery truck for $40,000 on July 1, 2022. The truck has an expected salvage value of $6,000, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 15,000 in 2022 and 12,000 in 2023. Cullumber uses the straight-line method of depreciation. (a) Compute depreciation expense for 2022 and 2023. Depreciation Expense 2022 2023 Straight-line method

Answer 1

Answer:

Depreciation Expense

2022: $ 4,250

2023: $ 4,250

Explanation:

Straight line Depreciation Method is the Depreciation Method that charges the same amount of depreciation over the useful life of an asset.

Depreciation = (Cost - Salvage Value ) / Useful Life

                      = ($40,000 - $6,000) / 8 years

                      = $ 4,250

Depreciation Expense

2022: $ 4,250

2023: $ 4,250