Little TownLittle TownPizza bought a used Ford delivery van onJanuary? 2,20182018?, for$ 21 comma 800$21,800. The van wasexpected to remain in service for four years left parenthesis 48750(48,750 miles). At the end of its useful? life, LittleTownLittle Town management estimated that the? van's residual valuewould be $ 2 comma 300$2,300. The van traveled 1500015,000 milesthe first? year, 1700017,000 miles the second? year, 1250012,500miles the third? year, and 42504,250 miles in the fourth year.
1. | Prepare a schedule of depreciation expense per year for the vanunder the three depreciation methods.? (For units-of-productionand? double-declining-balance methods, round to the nearest twodecimal places after each step of the? calculation.) |
2. | Which method best tracks the wear and tear on the? van? |
3. | Which method would Little TownLittle Town prefer to use for income tax? purposes? Explain your reasoning indetail. |
