Answer:
Account Titles Debit Credit
Depreciation Expense 10,000
Accumulated Depreciation 10,000
Explanation:
Depreciation is the actual decrease in the value of an asset. The asset is depreciated on its useful life on by a fixed percentage of carrying value.
Original Cost of Truck = $48,000
Estimated useful Life = 4 years
Estimated Salvage Value = $8,000
Formula for straight line depreciation is
Depreciation per year =( Cost of Asset - salvage value ) / useful life
Depreciation per year = ( $48,000 - $8,000 ) / 4 years
Depreciation per year = 10,000 per year
$10,000 will be charged every year for 4 years.
