Exercise 7-11 (Algo) Determine depreciation under three methods (LO7-4)

On January 1, Speedy Delivery Company purchases a delivery van for $28,000. Speedy estimates that at the end of its four-year service life, the van will be worth $4,000. During the four-year period, the company expects to drive the van 120,000 miles.

Actual miles driven each year were 33,000 miles in year 1 and 36,000 miles in year 2.

Calculate annual depreciation for the first two years using each of the following methods.

Double-declining-balance.

year 1

year 2