SBD decided to use group amortization for its new fleet of 10 panel delivery trucks. The trucks were purchased on January 1, 2013 at a cost of $12,000 each. The estimated useful life was 5 years and the estimated residual value was 10 percent of cost. Assume straight-line group amortization is used. SBD has a December 31 year-end and only accounts for amortization at year-end.
(a) At the end of 2013, amortization expense should be recorded in the amount of $____________________.
During 2014, three transactions occurred affecting the trucks:
(1) One truck was wrecked and the only recovery was $1,000 received from the salvage yard.
(2) Ordinary repair expenditures amounted to $700.
(3) A new truck was purchased at a cost of $12,200 on December 26.
(b) At the end of 2014, amortization expense should be recorded in the amount of $_____________________.

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The Answer of SBD decided to use group amortization for its new fleet of 10 panel delivery trucks. The trucks were purchased on January 1, 2013 at a cost of $12,000 each. The estimated useful life was 5 years and the estimated residual value was 10 percent of cost. Assume straight-line group amortization is used. SBD has a December 31 year-end and only accounts for amortization at year-end.
(a) At the end of 2013, amortization expense should be recorded in the amount of $____________________.
During 2014, three transactions occurred affecting the trucks:
(1) One truck was wrecked and the only recovery was $1,000 received from the salvage yard.
(2) Ordinary repair expenditures amounted to $700.
(3) A new truck was purchased at a cost of $12,200 on December 26.
(b) At the end of 2014, amortization expense should be recorded in the amount of $_____________________.

SBD Decided to Use Group Amortization for Its New Fleet