Respuesta :
Answer:
depreciation expense = $10500
correct option is a. $10,500
Explanation:
given data
Equipment costing = $70,000
salvage value = $14,000
estimated life = 8 years
revised estimated total life = 6 years
to find out
depreciation expense
solution
we know that Depreciation expense per year is here express as
Depreciation expense = (cost - Salvage value) ÷ useful life ...................1
put here value we get
Depreciation expense = [tex]\frac{70000 - 14000}{8}[/tex]
Depreciation expense = $7000 per year
so
book value as on beginning of year 3 is = 70000 - (7000 × 2)
book value as on beginning of year 3 is $56000
so
depreciation expense will be
depreciation expense = [tex]\frac{56000 - 14000}{4}[/tex]
depreciation expense = $10500
correct option is a. $10,500
Answer:The answer is b
Explanation:
Cost - Salvage value /useful life
Cost =$70,000
Salvage value = $14,000
Useful life = 8years
Cost - Salvage value /useful life
70,000-14,000/8
= 56,000/8
=7000
Therefore yearly depreciation = $7,000
Provision for depreciation
Ist year cost - depreciation (70,000 - 7,000) = 63,000
2nd year cost - depreciation (63,000 - 7,000) = 56,000
Net Book value for the 3rd year = 56,000
Assuming a revised total life
= Net Book value /revised total life
= 56,000/6
= $9,333
Therefore depreciation expenses = $9,333
