Computer equipment was acquired at the beginning of the year at a cost of $65,000 that has an estimated residual value of $3,800 and an estimated useful life of 8 years. What is the annual straight-line depreciation for the equipment?
A) $7,650
B) $8,125
C) $13,000
D) $12,250

Question

Quizplus · Accepted Answer

$61,200 (Initial cost - Estimated residual value = $65,000 - $3800)
12.5% (1/8) annual straight-line rate
$61,200 × 0.125 = $7,650

Computer Equipment Was Acquired at the Beginning of the Year