Kansas Enterprises purchased equipment for $60,000 on January 1, 2021. The equipment is expected to have a five-year service life,

Kansas Enterprises purchased equipment for $60,000 on January 1, 2021. The equipment is expected to have a five-year service life, with a residual value of $5,000 at the end of five years.
Using the straight-line method, depreciation expense for 2021 would be:

A) $12,000.

B) $11,000.

C) $60,000.

D) None of these.

Answer: B

Which depreciation method generally will result in the greatest amount of depreciation expense in the first year of the asset's life?

A) Straight-line.

B) Double-declining balance.

C) Activity-based.

D) Capitalization.

Answer: B

The depreciable cost used in calculating depreciation expense is:

A) Its service life.

B) The amount allowable under tax depreciation methods.

C) The difference between its replacement value and cost.

D) The asset's cost minus its estimated residual value.

Answer: D