In: Accounting
11. A company used straight-line depreciation for an item of equipment that cost $16,000, had a salvage value of $2,000 and a five-year useful life. After depreciating the asset for three complete years, the salvage value was reduced to $500 but its total useful life remained the same. Determine the amount of depreciation to be charged against the equipment during each of the remaining years of its useful life:
Select one:
a. $7,100
b. $3,550
c. $2,000
d. $2,800
e. $500
12. Ngu owns equipment that cost $90,000 with accumulated depreciation of $64,000. Ngu sells the equipment for $33,000. Compute the amount of gain or loss on the sale.
Select one:
a. $7,000 gain
b. No gain or loss is recognized
c. $57,000 loss
d. $7,000 loss
e. $33,000 gain