A company purchased equipment for $240,000 on Mar, 2021. The estimated service life is six years with a $60,000 residual value. The company records partial-year depreciation based on the number of months in service. Depreciation expense for the year ended December 31, 2021, using straight-line depreciation, is:
A) $33,333.
B) $40,000.
C) $30,000.
D) $25,000.
Answer: D
Best Construction purchased a delivery truck on June 1, 2021. The following information is available:
Cost = $90,000
Estimated service life = 5 years
Estimated residual value = $15,000
Calculate depreciation expense for the year ended December 31, 2021, using straight-line depreciation.
A) $8,750.
B) $15,000.
C) $6,250.
D) $18,000.
Answer: A
Best Construction purchased a delivery truck on June 1, 2021. The following information is available:
Cost = $90,000
Estimated service life = 5 years
Estimated residual value = $15,000
Calculate depreciation expense for the year ended December 31, 2022, using straight-line depreciation.
A) $8,750.
B) $15,000.
C) $6,250.
D) $18,000.
Answer: B
