Question

A machine was purchased for $35,500, having a useful life of 10 years, and a residual value of $6,000. Compute the annual depreciation expense using the straight-line method.

Answer 1

Answer:

Annual depreciation= $2,950

Explanation:

Giving the following information:

A machine was purchased for $35,500, having a useful life of 10 years, and a residual value of $6,000.

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= (35,500 - 6,000) / 10

Annual depreciation= $2,950