A Truck Costs $8,000 with a Residual Value of $1,000

question 67

Multiple Choice

A truck costs $8,000 with a residual value of $1,000. The truck is expected to have a useful life of 70,000 miles. Assuming the truck is driven 15,000 miles the first year, the depreciation expense would be:

• A)$1,714
• B)$1,500
• C)$1,174
• D)$1,505
• E)None of these

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Remote

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Contingent Liability

A potential financial obligation that may arise in the future, dependent on the outcome of a specific event.

Reasonably Estimable

A term used in accounting to describe a cost or liability that can be accurately predicted or projected.

Contingent Liability

A potential financial obligation depending on the outcome of future events, not yet confirmed as a liability.