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Sergio039 [100]
3 years ago
7

Equipment was purchased for $145500. Freight charges amounted to $6500 and there was a cost of $12000 for building a foundation

and installing the equipment. It is estimated that the equipment will have a $30000 salvage value at the end of its 5-year useful life. Depreciation Expense each year using the straight-line method will be____________.
Business
1 answer:
andrey2020 [161]3 years ago
7 0

Answer:

$26800

Explanation:

Total cost to be capitalized for the assets

= 145500 + 6500 +12000

= $164000

Estimated useful life = 5 years

Salvage value = $30000

Using the straight-line method,

Annual Depreciation = (Cost - Salvage value)/ Number of years

                                   = (164000 - 30000)/5

                                   = 134000/5

                                   = $26800

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