Carpenters Company,a manufacturing company,acquired equipment on January 1,2017 for $510,000.Estimated useful life of the equipment was seven years and the estimated residual value was $12,000.On January 1,2020,after using the equipment for three years,the total estimated useful life has been revised to nine total years.Residual value remains unchanged.The company uses the straight-line method of depreciation.Calculate depreciation expense for 2020.(Round any intermediate calculations to two decimal places,and your final answer to the nearest dollar.)

Question

Quizplus · Accepted Answer

Straight-line depreciation = (Cost - Residual value) / Useful life
Straight-line depreciation = (510,000 - 12,000) / 7 = 71,142.86
Depreciation provided for first three years = 71,142.86 × 3 = $213,428.58
Revised depreciation for the remaining useful life = ($510,000 - $213,428.58 - $12,000) / 6 = $47,429

Carpenters Company,a Manufacturing Company,acquired Equipment on January 1,2017 for $510,000