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  3. 3. chubbyville purchases a delivery van for $22,60

3. Chubbyville purchases a delivery van for $22,600. Chubbyville estimates a four-year service life and...

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Accounting

3. Chubbyville purchases a delivery van for $22,600. Chubbyville estimates a four-year service life and a residual value of $1,800. During the four-year period, the company expects to drive the van 110,000 miles. Calculate annual depreciation for the four-year life of the van using each of the following methods.

3a) What is the straight line depreciation expense?

3b) What is the double-declining balance? (Round depreciation rate to 2 decimal places. Round final to nearest whole dollar.)

End of Year Amounts
Year Depreciation Expense Accumulated Depreciation Book Value
1
2
3
4
Total

3c) Actual miles driven each year were 19,000 miles in Year 1; 30,000 miles in Year 2; 23,000 miles in Year 3; and 27,000 miles in Year 4. Note that actual total miles of 99,000 fall short of expectations by 11,000 miles. Calculate annual depreciation for the four-year life of the van using activity-based.

End of Year Amounts
Year Depreciation Expense Accumulated Depreciation Book Value
1
2
3
4
Total

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