On January 1, 2021, the Excel Delivery Company purchased a delivery van for $153,000. At the end of its five-year service life, it is estimated that the van will be worth $15,600. During the five-year period, the company expects to drive the van 458,000 miles. Required: Calculate annual depreciation for the five-year life of the van using each of the following methods. 2. Double-declining balance. (Round your answers to the nearest whole dollar amount.) Answer is complete but not entirely correct. Year 2021 2022 2023 2024 2025 Total Depreciation $ 61,200 36,720 22,032 13,219 7,932 $ 141,103 1

Question

Demarcus Reese

Business

30 January, 08:50

On January 1, 2021, the Excel Delivery Company purchased a delivery van for $153,000. At the end of its five-year service life, it is estimated that the van will be worth $15,600. During the five-year period, the company expects to drive the van 458,000 miles. Required: Calculate annual depreciation for the five-year life of the van using each of the following methods. 2. Double-declining balance. (Round your answers to the nearest whole dollar amount.) Answer is complete but not entirely correct. Year 2021 2022 2023 2024 2025 Total Depreciation $ 61,200 36,720 22,032 13,219 7,932 $ 141,103 1

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Answers (1)

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Kolby Sheppard · Answer 1

Instructions are listed below.

Explanation:

Giving the following information:

On January 1, 2021, the Excel Delivery Company purchased a delivery van for $153,000. At the end of its five-year service life, it is estimated that the van will be worth $15,600.

Annual depreciation = 2*[ (book value) / estimated life (years) ]

Year 1 = (153,000/5) * 2 = 61,200

Year 2 = [ (153,000 - 61,200) / 5]*2 = 36,720

Year 3 = (55,080/5) * 2 = 22,032

Year 4 = 13,219

Year 5 = 7,932

Total = $141,103