Question

On January 1, Truesdale, Inc., purchased a piece of machinery for use in operations. The total acquisition cost was $33,000. The machine has an estimated useful life of 3 years and a salvage value of $3,000. Using the straight-line method, the amount of depreciation that should be recorded during year 1, is approximately

Answer 1

Answer:

Annual depreciation= $10,000

Explanation:

Giving the following information:

The total acquisition cost was $33,000. The machine has an estimated useful life of 3 years and a salvage value of $3,000.

To calculate the depreciation expense under the straight-line method, we need to use the following formula:

Annual depreciation= (original cost - salvage value)/estimated life (years)

Annual depreciation= (33,000 - 3,000)/3

Annual depreciation= $10,000