A Company Purchased a New Delivery Van on January 1,2012

question 134

Essay

A company purchased a new delivery van on January 1,2012 for $25,000.The company expects to use the van for 5 years and then sell it for $5,000.Complete the following depreciation table assuming straight-line depreciation:
$$\begin{array} { | c | c | c | c | c | } \hline \begin{array} { c } \text { End of } \\\text { Year }\end{array} & \begin{array} { c } \text { Cost of Delivery } \\\text { Van }\end{array} & \begin{array} { c } \text { Depreciation } \\\text { Expense }\end{array} & \begin{array} { c } \text { Accumulated } \\\text { Depreciation, End } \\\text { of Year }\end{array} & \begin{array} { c } \text { Book Value, End of } \\\text { Year }\end{array} \\\hline 1 & & & & \\\hline 2 & & & & \\\hline 3 & & & & \\\hline 4 & & & & \\\hline 5 & & & & \\\hline\end{array}$$

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Definitions:

Net Assets

The total assets of an entity minus its total liabilities, indicating the entity's financial health and value.

Purchase Consideration

The total value transferred by an acquirer to obtain control of an acquired entity, which can include cash, securities, or other assets.

Net Fair Value

The amount that an asset could be bought or sold for in a current transaction between willing parties, minus any selling costs.

Unrecorded Goodwill

Goodwill that has arisen through operations but has not been formalized in the financial statements because it has not been acquired through a business combination.