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Whispering Winds Corp. purchased a delivery truck for $34,000 on January 1, 2022. The truck has an expected salvage value of $5,000, and is expected to be driven 100,000 miles over its estimated useful
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29 votes
29 votes
Whispering Winds Corp. purchased a delivery truck for $34,000 on January 1, 2022. The truck has an expected salvage value of $5,000, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 16,100 in 2022 and 11,700 in 2023.

User Rishabh Kumar
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1 Answer

13 votes
13 votes

Answer: $0.29 per mile

Step-by-step explanation:

Truck is to be driven for 100,000 miles.

It has a cost of $34,000 and a salvage value of $5,000.

Useful life is 8 years.

Depreciable cost per mile under units-of-activity method = (Cost price - Salvage value) / Miles to be driven

= (34,000 - 5,000) / 100,000

= $0.29 per mile

User TheMadKing
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