Suppose a company acquires an asset at the beginning of this year for $500,000. If the asset has a salvage value of $60,000 and is depreciated using straight-line over six years, the depreciation in the second year is closest to:
A) $60,000.
B) $73,333.
C) $83,333.

Question

Quizplus · Accepted Answer

The straight-line depreciation method calculates depreciation by subtracting the salvage value from the asset's cost and dividing by the useful life. Here, ($500,000 - $60,000) / 6 = $73,333 per year.

Suppose a Company Acquires an Asset at the Beginning of This