Straight-Line Depreciation A building acquired at the beginning of the year at a cost of $85,300...

Straight-Line Depreciation

A building acquired at the beginning of the year at a cost of $85,300 has an estimated residual value of $3,300 and an estimated useful life of 10 years. Determine the following:

(a)	The depreciable cost	$
(b)	The straight-line rate		%
(c)	The annual straight-line depreciation	$

Expert Solution

Answer (a):

Depreciable cost = Original cost - Estimated residual value

= $85,300 - $3,300

= $82,000

Answer (b):

Straight line rate = (1/ Useful life)* 100%

= (1/ 10)* 100%

= 10 %

Answer (c):

Annual straight line depreciation = Depreciable cost * Straight line rate

= $82,000 * 10 %

= $8,200

ekkarill92 answered 2 hours ago

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