Linton Company purchased a delivery truck for $34,000 on January 1, 2019. The truck has an expected of $2,000, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 15,000 in 2019 and 12,000 in 2020.
Instructions
(a) Compute depreciation expense for 2019 and 2020 using (1) the straight-line method, (2) the units-of-activity method, and (3) the double-declining-balance method.
(b) Assume that Linton uses the straight-line method.
(1) Prepare the journal entry to record 2019 depreciation.
(2) Show how the truck would be reported in the December 31, 2019, balance sheet.
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