Under the straight-line method, the amount of depreciation expense for the first full year of use of a fixed asset costing $95,000, with an estimated residual value of $5,000, and a useful life of 5 years, will be $18,000.

Question

Quizplus · Accepted Answer

The formula for calculating depreciation using the straight-line method is:

Depreciation expense = (Cost of asset - Residual value) / Useful life

Plugging in the given values, we get:

Depreciation expense = ($95,000 - $5,000) / 5 = $18,000

Therefore, the statement is true.

Under the Straight-Line Method, the Amount of Depreciation Expense for the First