4·The Net Book Value of an asset is equal to the A) asset\'s market value less i

Question

4·The Net Book Value of an asset is equal to the A) asset's market value less its historical cost B) blue book value relied on by secondary markets. C) replacement cost of the asset D) asset's cost less accumulated depreciation. 5. A company purchased factory equipment on April 1, 2011 for $80,000. It is estimated that the equipment will have a $10,000 salvage value (S/V) at the end of its 10-year useful life. Using the straight-line (S/L) method of depreciation, the amount to be recorded as depreciation expense at December 31, 2011 is A) $8,000. B) $7,000. C) $5,250. D) $6,000. 6. On October 1, 2015, Holt Company places a new asset into service. The cost of the asset is $120,000 with an estimated 5-year life and $30,000 salvage value (SV) at the end of its useful life. What is the depreciation expense for 2015 if Holt Company uses the straight-line (S/L) method of depreciation? A) $4,500 B) $24,000 C) $6,000 D) $12,000 7. Sargent Corporation bought equipment on January 1, 2015. The equipment cost $360,000 and had an expected salvage value (S/V) of $60,000. The asset life of the equipment was estimated to be 6 years. The depreciation expense using the straight- line (S/L) method of depreciation is A) $70,000. B) $72,000. C) $50,000. D) None of these answer choices are correct. 8. Equipment was purchased for $90,000. Freight charges amounted to $4,200 and there was a cost of $12,000 for installing the equipment. It is estimated that the equipment will have a S18,000 salvage value (S/V) at the end of its 5-year useful life. Depreciation expense each year using the straight-line method (S/L) will be A) $21,240. B) S17,640. C) $14,760. D) $14,400. Page 2

Explanation / Answer

Dear student, only one question is allowed at a time. I am answering the first question

4)

Net book value

= Purchase cost of the asset – Accumulated depreciation

So, as per above calculation, option D is the correct option

Related Questions

Navigate

• Browse (All)
• Browse 4
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.