Ron's Quik Shop bought equipment for $70,000 on January 1, 2013. Ron estimated the useful life to be 5 years with no salvage value, and the straight-line method of depreciation will be used. On January 1, 2014, Ron decides that the business will use the equipment for a total of 6 years. What is the revised depreciation expense for 2014?
A) $11,200.
B) $5,600.
C) $9,333. d $14,000.

Question

Quizplus · Accepted Answer

The revised depreciation expense for 2014 is $11,200. This is calculated by dividing the remaining cost of the equipment ($70,000 - $14,000 = $56,000) by the remaining useful life (6 years - 1 year = 5 years).

Ron's Quik Shop Bought Equipment for $70,000 on January 1