ACCT 201 Honors Fall 2017 33%D Test: FINAL EXAM This Question: 1 pt 01:37:27 Sub

Question

ACCT 201 Honors Fall 2017 33%D Test: FINAL EXAM This Question: 1 pt 01:37:27 Submit Test This Test: 40 pts tion acquired a building on January 1, 2015, for $25,000. On January 1, 2017, Marjorie Corporation determined that the building could only be used for Compute depreciation expense for the year ending December 31, 2017, if Marjorie 000. The building had an estimated useful life of 20 years and an estimated salvage value of had an estimated 10 years and there would be no salvage value. O A. $47,500 O B. $45,250 OC. $40,000 OD. $45,000 Click

Explanation / Answer

Purchase value of building as on 01/01/2015 - $500,000

salvage value - 25000

useful life - 20 years

Depreciation per annum – ($500,000-25000)/20 years = $23,750

Book value as on 01.01.2017 = 500,000 – (23750*2) = 452,500

Revised useful life = 10 years

Depreciation = 452,500/10 = $45240

Ans: B

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