Ursula Tax Planning Service has the following plant assets: Communications equipment: Cost, $6,720 with useful life of 8 years; Furniture: Cost, $18,000 with useful life of 12 years; and Computer: Cost, $12,000 with useful life of 4 years. Ursula's monthly depreciation expense calculated using the straight-line method is: (Assume salvage value of all the assets to be zero)

Question

Quizplus · Accepted Answer

The monthly depreciation expense is calculated by dividing the cost of each asset by its useful life in months and summing them up: ($6,720/96) + ($18,000/144) + ($12,000/48) = $70 + $125 + $250 = $445.

Ursula Tax Planning Service Has the Following Plant Assets: Communications