Question

A company purchased a new delivery van at a cost of $51,000 on July 1. The delivery van is estimated to have a useful life of 6 years and a salvage value of $3,900. The company uses the straight-line method of depreciation. How much depreciation expense will be recorded for the van during the first year ended December 31

Answer 1

Answer:

Annual depreciation (partial)= $3,925

Explanation:

First, we need to calculate the annual depreciation:

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

Annual depreciation= (51,000 - 3,900) / 6

Annual depreciation= $7,850

Now, the depreciation for 6 months:

Annual depreciation (partial)= (7,850/12)*6

Annual depreciation (partial)= $3,925