Computer equipment was acquired at the beginning of the year at a cost of $65,000 that has an estimated residual value of $3,000 and an estimated useful life of 5 years. Determine the 2nd year's depreciation using straight-line depreciation.
A) $26,000
B) $24,800
C) $12,400
D) $13,000

Question

Quizplus · Accepted Answer

Straight-line depreciation is calculated by subtracting the residual value from the cost and then dividing by the useful life. ($65,000 - $3,000) / 5 = $12,400 per year. The 2nd year's depreciation is also $12,400.

Computer Equipment Was Acquired at the Beginning of the Year