Jeff's Copy Shop purchased equipment for $18,000 on 1 January, 2019. Jeff estimated the useful life to be 3 years with no residual value, and the straight-line method of depreciation will be used. On 1 January, 2020, Jeff decides that the business will use the equipment for a total of 5 more years. What is the revised depreciation expense for 2019?
A) $6,000.
B) $3,000.
C) $2,400.
D) $4,500.

Question

Quizplus · Accepted Answer

The carrying amount on 1/1/2020 is ($18,000 - $6,000) $12,000. $12,000/5 years = $2,400 per year for the remaining 5 years.

Jeff's Copy Shop Purchased Equipment for $18,000 on 1 January