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yaroslaw [1]
2 years ago
15

Nash Company purchased a computer for $8,160 on January 1, 2019. Straight-line depreciation is used, based on a 5-year life and

a $1,020 salvage value. On January 1, 2021, the estimates are revised. Nash now feels the computer will be used until December 31, 2022, when it can be sold for $510. Compute the 2021 depreciation. (Round answer to 0 decimal places, e.g. 45,892.) Depreciation expense, 2021 $
Business
1 answer:
marishachu [46]2 years ago
8 0

Answer:

$2,397

Explanation:

Straight line method charges a fixed amount of depreciation

Depreciation Charge = (Cost - Residual Value) ÷ Estimated useful life

therefore,

<u>Annual depreciation charge</u>

2019

Depreciation Charge = $1,428

2020

Depreciation Charge = $1,428

2021

Depreciation Charge = ($8,160 - $1,428 - $1,428 - $510) ÷ 2

                                    = $2,397

therefore,

Depreciation expense, 2021 is $2,397

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