a.  Determine for each truck the depreciation rate per mile and the amount to be credited to the accumulated depreciation section of each subsidiary account for the miles operated during the current year. Keep in mind that the depreciation taken cannot reduce the book value of the truck below its residual value. Round the rate per mile to two decimal places. Enter all values as positive amounts. Truck No. Rate per Mile (in cents) Miles Operated Credit to Accumulated Depreciation 1 $   30,000   $   2 $   35,000   $   3 $   21,000   $   4 $   40,800   $         Total   $   b.  Journalize the entry to record depreciation for the year.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Prior to adjustment at the end of the year, the balance in Trucks is $407,000 and the balance in Accumulated Depreciation—Trucks is $120,300. Details of the subsidiary ledger are as follows:

Truck
No.
Cost Estimated
Residual
Value
Estimated
Useful
Life
Accumulated
Depreciation
at Beginning
of Year
Miles
Operated
During
Year
1 $78,500   $11,775   200,000 miles —       30,000 miles
2 110,000   13,200   350,000   $22,000       35,000  
3 91,000   12,740   210,000   $72,800       21,000  
4 127,500   15,300   340,000   $25,500       40,800  

a.  Determine for each truck the depreciation rate per mile and the amount to be credited to the accumulated depreciation section of each subsidiary account for the miles operated during the current year. Keep in mind that the depreciation taken cannot reduce the book value of the truck below its residual value.

Round the rate per mile to two decimal places. Enter all values as positive amounts.



Truck No.

Rate per Mile
(in cents)

Miles
Operated
Credit to
Accumulated
Depreciation
1 $   30,000   $  
2 $   35,000   $  
3 $   21,000   $  
4 $   40,800   $  
      Total   $  

b.  Journalize the entry to record depreciation for the year.

       
       
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Section 179 Deduction and Modified Accelerated Cost Recovery System (MACRS) Depreciation
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