Question

Swifty Corporation acquires a delivery truck at a cost of $43,000. The truck is expected to have a salvage value of $9,000 at the end of its 8-year useful life. Compute annual depreciation expense for the first and second years using the straight-line method.

Answer 1

The depreciation exp for the first year will be 4250 and second will be the same 4250

Step-by-step explanation:

First we have to subtract the salvage value from the cost of the truck as the method assumes

43000-9000=34000

Second we have to divide the amount we got already by the estimated useful life

34000/8=4250 the dep amount for the first year

Every year we have to do the same process as shown above to get the dep exp amount