Question

X-it Company bought a new delivery truck. The manufacturer says that the truck should last for ten years and 120,000 miles. X-it plans to use the truck for 4 years, during which it will be driven 50,000 miles. What is the useful life of the truck for depreciation purposes? (Check all that apply.)

Answer 1

The useful life of the truck for depreciation purposes is 4 years.

Step-by-step explanation:

The useful life of the truck for depreciation purposes is determined based on either the number of years or the number of miles, whichever comes first. In this case, X-it Company plans to use the truck for 4 years and drive it for 50,000 miles. Since both of these measures are within the specifications provided by the manufacturer (10 years and 120,000 miles), the useful life of the truck for depreciation purposes would be 4 years.