Question

Sheridan Company purchased a delivery truck for $32,800 on January 1, 2020. The truck has an expected salvage value of $1,800, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 16,400 in 2020 and 13,200 in 2021.

Compute depreciation expense for 2020 and 2021 using:

Double-declining-balance method:

Answer 1

Double declining method
DDB Rate= 1/8*200%	0.25	or 25%
Depreciation expense for 2020	$8,200
32800*25%
Depreciation expense for 2021	6150
(32800-8200)*25%