Pact Trucking Company uses the units-of-production depreciation method because units-of-production best measures wear and tear in trucks. Consider these facts about one Mack truck in the company?s fleet.

When acquired in 2013, the rig cost $450,000 and was expected to remain in service for 10 years or

1,000,000 miles. The estimated residual value was $120,000. The truck was driven 82,000 miles in 2013, 122,000 miles in 2014, and 162,000 miles in 2015. After 39,000 miles, on March 15, 2016, the company traded in the Mack truck for a less-expensive Freightliner. Pact also paid cash of $27,000. The fair market value of the Mack truck was equal to its net book value on the date of the trade.

AC1320: Module 5 Assets and Intangibles Lab 5.1 Assets Costs and Trade This lab requires you to journalize depreciation expenses, determine the cost of new assets, and journalize the exchange of assets, assuming that the exchange had commercial substance. Required Setup and Resources: Microsoft Excel and Microsoft Word Recommended Procedures: Pact Trucking Company uses the units-of-production depreciation method because units-of-production best measures wear and tear in trucks. Consider these facts about one Mack truck in the company's fleet. When acquired in 2013, the rig cost $450,000 and was expected to remain in service for 10 years or 1,000,000 miles. The estimated residual value was $120,000. The truck was driven 82,000 miles in 2013, 122,000 miles in 2014, and 162,000 miles in 2015. After 39,000 miles, on March 15, 2016, the company traded in the Mack truck for a less-expensive Freightliner. Pact also paid cash of $27,000. The fair market value of the Mack truck was equal to its net book value on the date of the trade. For the given transactions, complete the following tasks by using Lab 5.1 Worksheets: Task 1: Using the AC1320_nn_Lab 5.1_Task 1.xlsx worksheet, record the journal entry for depreciation expense in 2016. Task 2: Determine the cost of Pact's new truck. Task 3: Using the AC1320_nn_Lab 5.1_Task 3.xlsx worksheet, record the journal entry for the exchange of assets on March 15, 2016. Assume the exchange had commercial substance. Rename the worksheets, replacing nn with your initials. Submission Requirements: Submit the completed worksheets, AC1320_nn_Lab 5.1_Task 1.xlsx and AC1320_nn_Lab 5.1_Task 3.xlsx, along with the calculation of Pact's new truck cost to your instructor for evaluation. 1 AC1320: Module 5 Assets and Intangibles Lab 5.1 Assets Costs and Trade Evaluation Criteria: The lab will be evaluated using the following criteria: Task 1: Did you make the correct journal entries? Were the correct accounts debited and credited? Task 2: Did you correctly compute Pact's new truck cost? Task 3: Did you make the correct journal entry? Were the correct accounts debited and credited? 2