Question

Use the formula to calculate

2018

depreciation for each​ asset, and​ lastly, calculate the total cost and depreciation of all assets purchased in

2018.

​(Complete all answer boxes. Round depreciation per unit to the nearest cent and round final depreciation amounts to the nearest whole dollar. For any asset not​ depreciated, select​ "No depreciation taken on this​ asset" in the Formula column and enter a​ "0" in the Depreciation​ column.)

Date in service		Asset	Cost	Formula needed for 2018 depreciation
March 3		Equipment	$3,600	Cost x (1 / Useful life x 2) x (10 months / 12 months)
March 18		Truck	$35,800	[(Cost - Residual value) / Life in miles] x Miles driven
April 2		Land	$16,000	No depreciation taken on this asset
April 22		Furniture	$2,100	(Cost - Residual value) x (1 / Useful life) x (8 months / 12 months)
June 10		Furniture	$1,600	(Cost - Residual value) x (1 / Useful life) x (7 months / 12 months)
June 25		Equipment	$3,660	(Cost - Residual value) x (1 / Useful life) x (6 months / 12 months)
August 1		Building	$135,000	(Cost - Residual value) x (1 / Useful life) x (5 months / 12 months)
Depreciation

On March ​3, Fitness Equipment Doctor​, ​Inc., purchased equipment for $ 3 comma 600 cash. The equipment has an estimated useful life of four years and no salvage value. Fitness Equipment Doctor uses​ double-declining balance depreciation for the equipment.

On March ​18, Fitness Equipment Doctor​, ​Inc., purchased a $ 35 comma 800 truck financed by a note payable bearing 8 percent annual interest. The truck has an estimated useful life of 300 comma 000 miles and a residual value of $ 5 comma 800. The truck was driven 56 comma 000 miles in 2018 and is depreciated using the units of production method.

On April ​2, Fitness Equipment Doctor​, ​Inc., paid $ 16 comma 000 for land.

On April ​22, $ 2 comma 100 of furniture was purchased on account. The furniture has a four​-year life and a residual value of $ 300. Furniture is depreciated using​ straight-line depreciation.

On June ​10, $ 1 comma 600 of furniture was purchased. The furniture has a five​-year life and a residual value of $ 100 and is depreciated using​ straight-line depreciation.

On June ​25, $ 3 comma 660 of equipment was purchased. The equipment has a four​-year life and a $ 300 residual​ value, and is depreciated using the​ straight-line method.

On August ​1, Fitness Equipment Doctor​, ​Inc., purchased a building for $ 135 comma 000 financed by a mortgage bearing 5 percent annual interest. The building has an estimated salvage value of $ 30 comma 000 and is being depreciated over 25 years using the​ straight-line method.

Answer 1

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