A firm is considering purchasing two assets.Asset A will have a useful life of 12 years and cost $4 million;it will have installation costs of $300,000 and a salvage or residual value of $400,000.Asset B will have a useful life of 8 years and cost $3.5 million;it will have installation costs of $200,000 and a salvage or residual value of $800,000.Which asset will have a greater annual straight-line depreciation?
A) Asset A has $30,000 more in depreciation per year.
B) Asset A has $37,500 more in depreciation per year.
C) Asset B has $30,000 more in depreciation per year.
D) Asset B has $37,500 more in depreciation per year.
Correct Answer:
Verified
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