A company purchased a plant asset for $45,000. The asset has an estimated salvage value of $6,000, and an estimated useful life of 10 years. The annual depreciation expense using the straight-line method is $3,900 per year.
($45,000 - $6,000)/10 = $3,900

Question

Quizplus · Accepted Answer

The provided statement correctly calculates the annual depreciation expense using the straight-line method based on the cost, salvage value, and estimated useful life of the plant asset.

A Company Purchased a Plant Asset for $45,000