ACC 280 E10-7 Brainiac Company purchased a delivery truck for $30,000 on January 1, 2008.The

ACC 280 E10-7 Brainiac Company purchased a delivery truck for $30,000 on January 1, 2008.The

Principles of Accounting: Weygandt, J. J., Kimmel, P. D., & Kieso, D. E. (2008). Financial Accounting (6th ed.). Hoboken, NJ: Wiley. Axia College of University of Phoenix (UoP)

E10-7 Brainiac Company purchased a delivery truck for $30,000 on January 1, 2008.The truck has an expected salvage value 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 2008 and 12,000 in 2009.

Instructions

Compute depreciation using different methods

(a) Compute depreciation expense for 2008 and 2009 using (1) the straight-line method, (2) the units- of-activity method, and (3) the double-declining balance method.

(b) Assume that Brainiac uses the straight-line method.

(1) Prepare the journal entry to record 2008 depreciation.

(2) Show how the truck would be reported in the December 31, 2008, balance sheet.

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