A new vehicle was purchased on January 1 for $38,000. It has a salvage value of

Question

A new vehicle was purchased on January 1 for $38,000. It has a salvage value of $7,000 and a useful life of 5 years. To the nearest dollar, how much will the depreciation expense for the vehicle be for the first year using the straight - line method? A company purchased furniture on January 1. Its cost was $15,600, and it had a residual value of $1,600. Its useful life is determined to be 3 years. Using double - declining balance depreciation, the depreciation for year 1 to the nearest dollar will be: $4,667. $10,400. $5,200. $9,333.

Explanation / Answer

Solution:

Question 41

Question 42

Purchase price of vehicle 38,000 Less: Salvage Value 7,000 Depreciable value 31,000 Useful life 5 Per year depreciation 6,200 Depreciation for the year - $ 6,200 Therefore, the answer to the above question is A. $ 6,200

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