Response to the following problem:
J. B. Hunt is a large trucking company. Hunt uses the units-of-production (UOP) method to depreciate trucks because UOP depreciation best measures wear and tear. Hunt trades in used trucks often to keep driver morale high and to maximize fuel efficiency. Consider these facts about one Mack truck in the company's fleet.
When acquired in 20X1, the tractor/trailer rig cost $350,000 and was expected to remain in service for 10 years or 1,000,000 miles. Estimated residual value was $100,000. The truck was driven 80,000 miles in 20X1, 120,000 miles in 20X2, and 160,000 miles in 20X3. After 40,000 miles in 20X4, the company traded in the Mack truck for a lessexpensive Freightliner. Hunt paid cash of $50,000. Determine Hunt's cost of the new truck. Journal entries are not required.