Foxrun, Inc

Essay

Foxrun, Inc. purchased a truck at the beginning of 2015 for $32,500. Foxrun decided to depreciate the truck over an 8-year period using the straight-line method, and estimated its residual value to be $4,500. At the beginning of 2016, Foxrun determined that a 5-year life should have been used to depreciate the truck. The estimated residual value was not affected by the revision in the asset's life.
A. Determine the amounts to be recorded as depreciation expense for 2015 and 2016.
B. What factors may have influenced Foxrun to change the useful life?