On March 31 2016 Logan Trucking purchased a used Kenworth tr

On March 31, 2016, Logan Trucking purchased a used Kenworth truck at a cost of $45,000. Logan Trucking expects to drive the truck for 5 years and to have a residual value of $5,000. Compute Logan Trucking\'s depreciation expense on the truck for the year ended December 31, 2016, using the straight-line method. Start by determining the formula needed to calculate straight-line depreciation on the truck through December 31, 2016.

Solution

(Cost-Salvage value)/No. of years*No. of months used in year= Straight line depreciation (45000-5000)/5*9/12 $6,000 If any doubt please comment. If satisfiied you can rate