Question

Carla Vista Deliveries acquired a truck at a cost of $75,520 on January 1, 2014. The truck is expected to have a salvage value of $9,440 at the end of its 4-year useful life. Carla Vista uses the straight-line method. Prepare the journal entry to record annual depreciation for 2015. Ltdit account titles are automatically indented when amount is entered. Do not indent manually)

Answer 1

Depreciation expense debit 16,520

Accumulated depreciation Credit 16,520

Explanation:

Cost of truck $75,520

Salvage value $9,440

Value to depreciated over 4 years = 75,520 - 9,440 = 66,080

Each year depreciation = 55,080 / 4 = 16,520

Jounal entry

Depreciation expense debit 16,520

Accumulated depreciation Credit 16,520