Depreciation by units-of-activity Method Prior to adjustment at the end of the year, the balance...
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Accounting
Depreciation by units-of-activity Method
Prior to adjustment at the end of the year, the balance in Trucks is $211,400 and the balance in Accumulated DepreciationTrucks is $23,905. 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
$43,500
$5,700
140,000
miles
21,000
miles
2
61,200
8,000
280,000
$505
22,000
3
33,100
2,700
190,000
7,000
34,000
4
73,600
10,700
170,000
16,400
34,000
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.
Truck No.
Rate per Mile (in cents)
Miles Operated
Credit to Accumulated Depreciation
1
$
21,000
$
2
22,000
3
34,000
4
34,000
Total
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