Lima Enterprises purchased a depreciable asset for $22,000 on April 1,Year 1.The asset will be depreciated using the straight-line method over its four-year useful life.Assuming the asset's salvage value is $2,000,Lima Enterprises should recognize depreciation expense in Year 2 in the amount of:
A)$10,000
B)$5,000
C)$5,500
D)$20,000
E)$9,250

Question

Quizplus · Accepted Answer

The total depreciable amount is $22,000 (cost) - $2,000 (salvage value) = $20,000. Over a 4-year life, annual depreciation is $20,000 / 4 = $5,000.

Lima Enterprises Purchased a Depreciable Asset for $22,000 on April