Fidelity Industries purchased a new truck for $128,000. The company expected the truck to last 5 years or 50,000 miles, with an estimated salvage value of $16,000 at the end of that time. In the first year, the truck was driven 17,600 miles. As the accountant for Fidelity, you can depreciate this truck using the double-declining-balance method or the units of production method.
A)Which method of depreciation will allow the largest write-off in the first year?
B)How much greater would the depreciation expense be using your answer to (a) above?

Question

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The Answer of Fidelity Industries purchased a new truck for $128,000. The company expected the truck to last 5 years or 50,000 miles, with an estimated salvage value of $16,000 at the end of that time. In the first year, the truck was driven 17,600 miles. As the accountant for Fidelity, you can depreciate this truck using the double-declining-balance method or the units of production method.

Fidelity Industries Purchased a New Truck for $128,000