Depreciation for Partial Periods

Lightning Delivery Company purchased a new delivery truck for $45,000 on April 1, 2013. 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 2013 and 13,000 miles in 2014. Lightning computes
depreciation to the nearest whole month.
Required:

Depreciation for Partial Periods

Lightning Delivery Company purchased a new delivery truck for $45,000 on April 1, 2013. 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 2013 and 13,000 miles in 2014. Lightning computes
depreciation to the nearest whole month.
Required:
1. Compute depreciation expense for 2013 and 2014 using the
(Round your answers to the nearest dollar.)
2013 $
2014 $
1. Straight-line method
2013 $
2014 $
2. Sum-of-the-years\'-digits method
2013 $
2014 $
3. Double-declining-balance method
2013 $
2014 $
4. Activity method
2. For each method, what is the book value of the machine at the end of 2013? At the end of 2014?
(Round your answers to the nearest dollar.)
2013 $
2014 $
1. Straight-line method
2013 $
2014 $
2. Sum-of-the-years\'-digits method
2013 $
2014 $
3. Double-declining-balance method
2013 $
2014 $
4. Activity method
3. The book value of the asset in the early years of the asset\'s service will be - Select your answer -higherlowerabout the sameItem 17 under
an accelerated method as compared to the straight-line method. The- Select your answer -sum-of-the-years-digitsdouble-declining
balancestraight-lineactivityItem 18 method is appropriate when the service life of the asset is affected primarily by the amount the asset is
used.

Solution
1. Compute depreciation expense for 2013 and 2014 using the (Round your answers to the nearest dollar.) 1. Straight-line method 2013 3150
2014 4200 2. Sum-of-the-years\'-digits method 2013 5727 2014 7064 3. Double-declining-balance method 2013 6750 2014 7650 4. Activity
method 2013 3500 2014 4550 2. For each method, what is the book value of the machine at the end of 2013? At the end of 2014? (Round your
answers to the nearest dollar.) 1. Straight-line method 2013 41850 2014 37650 2. Sum-of-the-years\'-digits method 2013 39273 2014 32209 3.
Double-declining-balance method 2013 38250 2014 30600 4. Activity method 2013 41500 2014 36950 3. The book value of the asset in the
early years of the asset\'s service will be Lower Item 17 under an accelerated method as compared to the straight-line method. The Activity Item
18 method is appropriate when the service life of the asset is affected primarily by the amount the asset is used.