Big Trucking Company has purchased a $100,000 dump truck that has a useful life of 8 years. After the first year of use, the market value of the dump truck falls to $70,000. What is the straight- line depreciation of the dump truck?

Question

Quizplus · Accepted Answer

Straight-line depreciation is calculated by subtracting the salvage value from the initial cost and then dividing by the useful life. Assuming no salvage value, the calculation is $100,000 / 8 = $12,500 per year.

Big Trucking Company Has Purchased a $100,000 Dump Truck That