On January 1, 2012, a Company Buys a Truck for $42,000

question 98

Essay

On January 1, 2012, a company buys a truck for $42,000 cash. It has estimated residual value of $2,000, and an estimated life of 8 years, or 200,000 miles. At the end of 2012, the truck had driven 30,000 miles. If the company uses units-of-production depreciation, please show the journal entry for the first year depreciation.

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Definitions:

Grain

A small, hard, dry seed used as food, harvested from cereals or legumes.

Rats

While often considered in scientific and medical research contexts, in economics, could metaphorically reference unanticipated variables or detrimental elements affecting market dynamics.

Consume

The process of consuming a product or service to fulfill needs or desires.

Utility Function

A utility function is a representation of preferences over a set of goods and services, showing the level of satisfaction or utility that different bundles of goods provide to a consumer.