A Company Purchased a Van at a Cost of $42,000

question 99

Multiple Choice

A company purchased a van at a cost of $42,000 and expects its salvage value to be $6,000 after 120,000 miles of service.Using the units-of-production method,what is the first year's depreciation if the van is driven 24,000 miles?

• A)$1,200
• B)$4,200
• C)$7,200
• D)$12,000

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Definitions:

Drive Axle Wheel Lock

A safety mechanism that prevents the drive axle wheels from rotating, typically used in vehicles to ensure stability when parked.

Trailer Jackknife

Trailer jackknife refers to a dangerous situation where a trailer skews to form a sharp angle with the vehicle towing it, often due to sudden swerving or braking.

2S/2M Tractor ABS

A specific type of Anti-lock Braking System configuration for semi-trailers, with two sensors and two modulators designed to prevent wheel lockup during braking.

Trailer Swing Accidents

Incidents where the trailer of a tractor-trailer combination swings out and potentially causes an accident, often due to sudden maneuvers or slippery conditions.