A company purchased a plant asset for $45,000.The asset has an estimated salvage value of $6,000,and an estimated useful life of 10 years.The annual depreciation expense using the straight-line method is $3,900 per year.

Question

Quizplus · Accepted Answer

Depreciation Expense = (Cost - Salvage Value)/Estimated Useful Life
Depreciation Expense = ($45,000 - $6,000)/10; Depreciation Expense = $3,900

A Company Purchased a Plant Asset for $45,000