(solution) On January 13, 2010, Silverio Oil Company purchased a drilling

(solution) On January 13, 2010, Silverio Oil Company purchased a drilling

On January 13, 2010, Silverio Oil Company purchased a drilling truck for $45,000. Silverio expects the truck to last five years or 200,000 miles with an estimated residual value of $7,500 at the end is December 31. Compute the depreciation of 2011 under each of the following methods: (1) Straight-line, (2) Production, and (3) Prepare the entry in journal form to record depreciation expense for the second year, and show how the Drilling truck account would appear on the balance sheet.