Question: Energex Travel runs boat tours along the west coast of

Energex Travel runs boat tours along the west coast of British Columbia. It purchased on March 5, 2014, for cash of $828,000, a cruising boat with a useful life of 10 years or 13,250 hours with a residual value of $192,000. The company’s year-end is December 31.

Required
Calculate depreciation expense for the fiscal years 2014, 2015, and 2016 by completing a schedule with the following headings (round to the nearest whole dollar):


1. Depreciation is calculated to the nearest month.
2. Assume actual hours of service were: 2014, 720; 2015, 1,780; 2016, 1,535.
Analysis Component: If you could ignore the matching principle, how could you record the purchase of the boat? What impact would this have on the financial statements in the short and longterm?
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  • CreatedJanuary 08, 2015
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