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just olya [345]
2 years ago
6

On January 1, a machine with a useful life of 5 years and a salvage value of $15000 was purchased for $115000. What is the depre

ciation expense for year 2 under straight-line depreciation
Business
1 answer:
grandymaker [24]2 years ago
5 0

Answer:

Annual depreciation (year 2)= $20,000

Explanation:

Giving the following information:

Purchase price= $115,000

Salvage value= $15,000

Useful life= 5 years

<u>To calculate the annual depreciation under the straight-line method, we need to use the following formula:</u>

<u></u>

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

Annual depreciation= (115,000 - 15,000) / 5

Annual depreciation= $20,000

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Answer:

$3,412

Explanation:

The computation of the economic order quantity is shown below:

= \sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}}

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The carrying cost is

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= 40.62 orders

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