CALGULATOR DUNTEROBMS Multiple Choice Question 92 Equipment was purchased for $8

Question

CALGULATOR DUNTEROBMS Multiple Choice Question 92 Equipment was purchased for $85400 on January 1, 2016. Freight charges amounted to $3000 and there was a cost of $14000 for building a foundation and installing the equipment. It is estimated that the equipment will have a $19000 salvage value at the end of its 5-year useful life. What is the amount of accumulated depreciation at December 31, 2017, if the straight-line method of depreciation is used? O $33360. O $13680. O $27880. O $16680. Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT Question Attempts: 0 of 3 used SAVE FOR LATER spo RS, BU

Explanation / Answer

Cost of the Equipment = $85,400 + $3000 + $14,000 = $102,400

Depreciation = (Cost - Salvage value) / Number of useful years

= (102,400 - 19000) / 5

= $16,680 each year

Depreciation for the Year 2016 = $16,680

+ Depreciation for the year 2017 = $16,680   

Acumulated Depreciation on 31st December 2017 $33,360

CONCLUSION: Option A is correct.

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