On January 1,Able Company purchased equipment costing $135,000 with an estimated salvage value of $10,500,and an estimated useful life of five years.Using the straight-line method,what is the amount that should be recorded as depreciation on December 31?

Question

Quizplus · Accepted Answer

To calculate straight-line depreciation, we need to subtract the salvage value from the cost of the equipment and divide that amount by the useful life in years:

($135,000 - $10,500) / 5 = $24,900

Therefore, the amount that should be recorded as depreciation on December 31 is $24,900.

On January 1,Able Company Purchased Equipment Costing $135,000 with an Estimated