Monty Company acquires a delivery truck at a cost of $62,000. The truck is expected to have a salvage value of $12,000 at the end of its 4-year useful life. Compute annual depreciation expense for the first and second years using the straight-line method.

The depreciation of the 1st year is $12500, while that of 2nd year is $25000.

Explanation:

As per the given data

Cost=$62000

Salvage Value=$12000

Useful Life=4 years

The depreciation for a year is given as

Depreciation for a year=(Cost-Salvage Value)/Useful Life

                                      =$62000-$12000/4

                                      =$50000/4=$12500

So the depreciation of 1st year is $12500

The depreciation of 2nd year is $12500x2=$25000

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1) the stages a new product goes through from beginning to end, i.e., the stages that a product passes through from introduction through growth, maturity, and decline. 2) the time from initial research and development to the time at which sales and support of the product to customers are withdrawn. 3) the period of time during which a product can be produced and marketed profitably.

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