Henry Tax Planning Service bought communications equipment for $9,600 on January 1, 2015. It has an estimated useful life of 5 years and zero residual value. Henry uses the straight-line method to calculate depreciation and records depreciation expense in the books at the end of every month. As of June 30, 2015, the balance in the Accumulated Depreciation account for this equipment is:

Question

Quizplus · Accepted Answer

The annual depreciation expense is $9,600 / 5 years = $1,920. Monthly depreciation is $1,920 / 12 months = $160. For 6 months (January to June), the accumulated depreciation is $160 * 6 = $960.

Henry Tax Planning Service Bought Communications Equipment for $9,600 on January