Question: On January 1 2014 Land s End Construction purchased a used

On January 1, 2014, Land’s End Construction purchased a used truck for $37,500. A new motor had to be installed to get the truck in good working order; the costs were $13,500 for the motor and $6,750 for the labor. The truck was also painted for $5,250. It was ready for use by January 4. A six-month insurance policy costing $3,600 was purchased to cover the vehicle. The driver filled it with $180 of gas before taking it on its first trip. It is estimated that the truck has a five-year useful life and a residual value of $7,500. Land’s End uses the straight-line method to depreciate all of its vehicles. Record depreciation at year-end, December 31, 2014.

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  • CreatedJanuary 08, 2015
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