Asked by ngozika jonah on Jul 16, 2024
Verified
The machine's useful life is estimated to be 5 years with a $4,000 salvage value.Depreciation expense in year 2 is:
A) $4,800.
B) $4,000.
C) $9,600.
D) $20,000.
E) $0.
Straight-line Method
A method of calculating depreciation for an asset, spreading the cost evenly over its useful life.
Salvage Value
The calculated remaining value of an asset at the close of its productive life.
Depreciation Expense
An accounting method of allocated the cost of a tangible or physical asset over its useful life, representing how much of the asset's value has been used up.
- Engage the straight-line, double-declining-balance, and units-of-production schemes for depreciating assets.
Verified Answer
NJ
Nishitha JanakiramJul 18, 2024
Final Answer :
B
Explanation :
The depreciation expense is calculated by subtracting the salvage value from the cost and then dividing by the useful life. ($24,000 - $4,000) / 5 = $4,000 per year.
Learning Objectives
- Engage the straight-line, double-declining-balance, and units-of-production schemes for depreciating assets.