Depreciation for Partial Periods
Lightning Delivery Company purchased a new delivery truck for $45,000 on April 1, 2016. The
truck is expected to have a service life of 10 years or 120,000 miles and a residual value of
$3,000. The truck was driven 10,000 miles in 2016 and 13,000 miles in 2017. Lightning
computes depreciation expense to the nearest whole month.
Required:
1.
Compute depreciation expense for 2016 and 2017 using the
(Round your answers to the nearest dollar.)
a. Straight-line method
2016
2017 $
$ b. Sum-of-the-years’-digits method
2016
2017 $
$ c. Double-declining-balance method
2016
2017 $
$ d. Activity method
2016
2017 2. $
$ For each method, what is the book value of the machine at the end of 2016? At the end of
2017?
(Round your answers to the nearest dollar.) a. Straight-line method
2016
2017 b. $
$
Sum-of-the-years’-digits method 2016
2017 $
$ c. Double-declining-balance method
2016
2017 $
$ d. Activity method
2016
2017 $
$