Machinery was purchased for $340,000 on January 1, 2017. Freight charges amounted to $14,000 and there was a cost of $40,000 for

Question

3 years ago

11

Machinery was purchased for $340,000 on January 1, 2017. Freight charges amounted to $14,000 and there was a cost of $40,000 for

building a foundation and installing the machinery. It is estimated that the machinery will have a $60,000 salvage value at the end of its 5-year useful life. What is the amount of accumulated depreciation at December 31, 2018, if the straight-line method of depreciation is used

Business

1 answer:

creativ13 [48] · Answer 1 · 2022-09-29T17:56:44+03:00

Answer:

$133,600

Explanation:

Straight line depreciation expense = (cost of asset - salvage value) / number of year

Cost of asset = $340,000 + $14,000 + $40,000 = $394,000

($394,000 - $60,000) / 5 = $66,800

The amount of accumulated depreciation at December 31, 2018 = $66,800 x 2 = $133,600