Emir Company purchased equipment that cost $110,000 cash on January 1, Year 1. T

Question

Emir Company purchased equipment that cost $110,000 cash on January 1, Year 1. The equipment had an expected useful lfe of six years and an nd an estimated salvage value of $8,000. Assuming that Emir depreciates its assets under the straight-line method, the amount of depreciation expense appearing on the Year 4 income statement and the amount of accumulated depreciation appearing on the December 31, Year 4, balance sheet would be: preciation Accumulated expens depreciation $17,000 $68,000 $17,000 $51,000 A. $17,000 $17,000 $68,000 $17,000 D. Multiple Choice Option D Option C Option A Option B

Explanation / Answer

D. Option B

Straight Line method:

Annual Depreciation = (Machine cost - Salvage value) / Useful years

Annual Depreciation = ($110,000 - $8,000) / 6

= $17,000

Accumulated depreciation = $17,000 × 4 = $68,000

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