Question

A company purchased a piece of equipment for $350,000 in 2008. As of 12/31/2015, $215,000 of depreciation expense had been recognized against this piece of equipment. What is the equipment's net book value on 12/31/2015?

Answer 1

Answer:

The equipment's net book value on 12/31/2015 is $ 135000.

Explanation:

Net book value of the equipment on 12/31/2015 is given by:

Net book value = cost of the equipment - depreciation expense recognized until 12/31/2015

                          = $ 350000 - $ 215000

                          = $ 135000

Therefore, the equipment's net book value on 12/31/2015 is $ 135000.