Question: Tasty Subs acquired a delivery truck on October 1, 2012, for $16,500. The company estimates a residual value of $1,500 and a six-year service life. It expects to drive the truck 100,000 miles. Actual mileage was 4,000 miles in 2012 and 17,000 miles in 2013.
Required: Calculate depreciation expense using the activity-based method for 2012 and 2013, assuming a December 31 year-end.