An insurance office purchased office furniture costing $9,000 and put it into use on April 1. The furniture is expected to have a useful life of 10 years and an estimated resale value of $600. Using the straight-line method of depreciation, compute the book value at the end of the third year.​

Straight-Line Method

A depreciation method that allocates an equal amount of depreciation each year over the useful life of the asset.

Resale Value

The likely selling price of a good or asset if sold at a future date, considering depreciation or appreciation.

Office Furniture

Items designed for use in a work or office setting, including desks, chairs, and file cabinets.