Answer:
The depreciation expense for 2025 is $50,000.
Explanation:
Straight line method charges a fixed amount of depreciation based on the cost of asset during the period of use.
Here the Bulldozer, the treads and the blades are significant in value and have different consumption pattern, thus they are all depreciated separately.
The Depreciation Expense Calculation is as follows :
<em>Depreciation Expense = (Cost - Residual Value) ÷ Estimated Useful Life</em>
thus,
Depreciation Expense (Bulldozer) = ($500,000 - $45,000 - $20,000) ÷ 10
= $43,500
Depreciation Expense (Treads) = ($45,000 - $0) ÷ 10
= $4,500
Depreciation Expense (Blade) = ($20,000 - $0) ÷ 10
= $2,000
Total depreciation expense is = $43,500 + $4,500 + $2,000
= $50,000
