Viva Inc. had bought machine X for $15,500 two years ago. The machine had no residual value and had an estimated useful life of 10 years. If the company uses the straight line depreciation method, calculate the current book value of the machine.

Question

Quizplus · Accepted Answer

The machine depreciates by $1,550 per year ($15,500/10 years). After 2 years, the depreciation is $3,100. The current book value is $15,500 - $3,100 = $12,400.

Viva Inc Had Bought Machine X for $15,500 Two Years Ago