Arizona Teak Company paid $54,000 for computers. These computers have an estimated service life of 3 years. The straight line depreciation method is used. After one year of use, the book value of the computers will be:

Question

Quizplus · Accepted Answer

Using the straight line method, the annual depreciation expense would be $54,000 / 3 = $18,000. After one year of use, the accumulated depreciation would be $18,000, and the book value would be $54,000 - $18,000 = $36,000. Therefore, the correct answer is D.

Arizona Teak Company Paid $54,000 for Computers