The Delivery Vehicles Account in the Ledger of Transit Co

Multiple Choice

The Delivery Vehicles account in the ledger of Transit Co. has a balance of $55 000 which is the cost of two second-hand trucks purchased on 1 July 2017. The Accumulated Depreciation - Delivery Vehicles account has a balance on 30 June 2020, before adjusting entries, of $20 000. No additional delivery trucks have been acquired or
Sold. The residual value of each truck is estimated to be $2500 and the straight-line depreciation method is used. What is the necessary adjusting entry to record annual depreciation on 30 June 2020?

A) DR Depreciation expense $5 000; CR Delivery vehicles $5 000
B) DR Accumulated depreciation $10 000; CR Delivery vehicles $10 000
C) DR Depreciation expense $5 000; CR Cash at bank $5 000
D) DR Depreciation expense $10 000; CR Accumulated depreciation $10 000