On October 1, 2021, Marshwinds Wind Turbine Company places a new asset into service. The cost of the asset is $ 8,000 with an estimated 5-year life and $ 2,000 residual value at the end of its useful life. What is the depreciation expense for 2021 if Marshwinds Wind Turbine Company uses the straight-line method of depreciation?
A) $ 300
B) $ 1,600
C) $ 400
D) $ 800

Question

Quizplus · Accepted Answer

Depreciation expense = (Cost of asset - Residual value) / Useful life= (8,000 - 2,000) / 5= $ 1,200Depreciation expense for 2021 = 1,200 / 2= $ 600

On October 1, 2021, Marshwinds Wind Turbine Company Places a New