Question

Kansas Enterprises purchased equipment for $73,500 on January 1, 2018. The equipment is expected to have a five-year life, with a residual value of $6,300 at the end of five years.
Using the straight-line method, the book value at December 31, 2018 would be:
A.$53,760.
B.$60,060.
C.$58,800.
D.$67,200.

Answer 1

Answer:

Using the straight-line method, the book value at December 31, 2018 would be: A.$53,760.

Explanation:

       Year 1 Year 2 Year 3 Year 4 Year 5

Cost 67200 53.760 40.320 26.880 13.440

Dep-Acu   13.440 13.440 13.440 13.440 13.440

Book Value 53.760 40.320 26.880 13.440 0