On January 1, 2013, Luck Delivery Company acquired a new

On January 1, 2013, Luck Delivery Company acquired a new truck for $30,000. It estimated the truck to have a useful life of five years and no salvage value. The company closes its books annually on December 31. Indicate the amount of the depreciation charge for each year of the asset’s life under the following methods:
a. The straight-line (time) method.
b. The double-declining-balance method, with a switch to straight-line in 2016.
c. The sum-of-the-years’-digits method.
d. The truck belongs to a category of property for tax purposes requiring the following proportions of the asset’s cost to be depreciated each year: 0.20, 0.32, 0.192, 0.115, 0.115, 0.058. The tax law allows firms to ignore salvage value in calculating depreciation.

Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...


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