Carolina Truck Lines purchased a truck at a cost of $22,000 in 2014. As of January 1, 2019, depreciation of $18,000 had been recorded on this asset. Depreciation expense for 2019 is $2,000. Before the adjustments are recorded and posted at December 31, 2019, what is the truck's book value?

Question

Quizplus · Accepted Answer

Book value = Cost - Accumulated depreciation
Accumulated depreciation as of January 1, 2019 = $18,000
Depreciation expense for 2019 = $2,000
Accumulated depreciation as of December 31, 2019 = $18,000 + $2,000 = $20,000
Book value as of December 31, 2019 = $22,000 - $20,000 = $2,000

Carolina Truck Lines Purchased a Truck at a Cost of $22,000