Martin Company purchases a machine at the beginning of the year at a cost of $60,000.The machine is depreciated using the straight-line method.The machine's useful life is estimated to be 4 years with a $5,000 salvage value.The book value of the machine at the end of year 4 is:
A)$13,750.
B)$55,000.
C)$30,000.
D)$5,000.
E)$0.

Question

Quizplus · Accepted Answer

The book value of the machine at the end of year 4 is its salvage value, which is $5,000, because the straight-line depreciation method would have fully depreciated the machine to its salvage value over its useful life.

Martin Company Purchases a Machine at the Beginning of the Year