Muller Corporation purchased a new truck on January 1,2012 for $55,000 cash.Muller estimated the truck would have a salvage value of $4,000 at the end of the useful life of 5 years.On January 2,2014 Muller had to replace the engine of the truck paying $7,500 cash.Due to the replaced engine,Muller estimates that the truck will continue a productive life for another four years.
Required:
Assuming straight-line depreciation is used,calculate the depreciation expense for 2014.

Question

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The Answer of Muller Corporation purchased a new truck on January 1,2012 for $55,000 cash.Muller estimated the truck would have a salvage value of $4,000 at the end of the useful life of 5 years.On January 2,2014 Muller had to replace the engine of the truck paying $7,500 cash.Due to the replaced engine,Muller estimates that the truck will continue a productive life for another four years.
Required:
Assuming straight-line depreciation is used,calculate the depreciation expense for 2014.

Muller Corporation Purchased a New Truck on January 1,2012 for $55,000