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D) oseta cost less useful lifc. Using the straight-lie (S/1) espense st December

ID: 2601162 • Letter: D

Question

D) oseta cost less useful lifc. Using the straight-lie (S/1) espense st December 31.2011 i cembed t desrociab at lhe end of lmated C) 55,230 6. On October I. 2015, Holt Company places a new assart into service. The cost of thve aswet is $120,000 with an eatimated S-year life and 530.000 salvnge valoe (S/) at the ena of its usefal life What is the depreciation expense for 2015 if Holt Compony uses the A) $4,500 B) 524,000 C) 56,000 $12,000 7. Sargent Corporation bought equipment on January 1,2015. The equipemem cos 5360,000 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) 350,000. D) None of these answer choices are conmect 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 $18,000 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) $17,640. C) $14,760. D) $14,400 Page 2

Explanation / Answer

4. option D. asset cost less accummulated depreciaiton is correct

5. option c. 5250

6. option A. 4500

7. option C.50000

8. option B.17640

Depreciatin expense= [Cost- salvage value]/ useful life Cost=                                80,000 Salvage value=                                10,000 Useful life (in years)=                                        10 a Depreciatin expense= [80000-10000]/ 10 7,000 Per year b=a/12 Depreciation per month= 583.33 c Number of months used 9 d=b*c Depreciation expense 5250