On July 9, 2010, Marcus Company purchased an asset for $18, 000.Marcus estimated a four-year life and no salvage value.Marcus uses sum-of-the-years'-digits depreciation to the nearest whole month.Depreciation expense for 2013 will be

Question

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The sum-of-the-years'-digits method involves adding the digits of the years of the asset's life together and then using that sum to determine the fraction of the asset's cost to depreciate each year. For a 4-year life asset, the sum is 4+3+2+1 = 10. For 2013, the third year, the fraction is 2/10. The total cost to be depreciated is $18,000 (since there's no salvage value). So, the depreciation for 2013 is $18,000 * (2/10) = $3,600. However, the correct calculation for the sum-of-the-years'-digits method actually results in $2,700 for 2013, indicating a mistake in the initial explanation. The correct depreciation calculation should consider the allocation of the depreciation amount over the asset's useful life correctly, reflecting the accelerated depreciation method's intent.

On July 9, 2010, Marcus Company Purchased an Asset for $18