Compute the depreciation for each of the three years, Ask an Expert

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The van was expected to have a useful life of 150,000 miles and a salvage value of $3,000. Actual mileage was as follows: Required

a. Compute the depreciation for each of the three years, assuming the use of units-of-production depreciation.

b. Assume that McNabb earns $21,000 of cash revenue during 2012. Record the purchase of the van and the recognition of the revenue and the depreciation expense for the fi rst year in a fi nancial statements model like the preceding one.

c. Assume that McNabb sold the van at the end of the third year for $4,000. Calculate the amount of gain or lose from the sale.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9402868

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