Question
In: Accounting
Computer equipment was acquired at the beginning of the year at a cost of $72,700. It...
Computer equipment was acquired at the beginning of the year at a
cost of $72,700. It had an estimated residual value of $3,500 and
an estimated useful life of 5 years.
A. Determine the depreciable cost
B. Determine the straight-line rate
C. Determine the annual straight-line depreciation
Solutions
Expert Solution
| a. | The depreciable cost | = | $ 69,200 | |
| b. | The Straight line rate | = | 20% | |
| c. | Annual Depreciation | = | $ 13,840 | |
| Workings: | ||||
| The depreciable cost | = | (Cost - Residual value) | ||
| = | ($72700 - $3500) | |||
| = | $ 69,200 | |||
| The Straight line rate | = | 1 / useful life | ||
| = | 1/5 | |||
| = | 20% | |||
| Depreciation for the year | = | $69200 X 20% | ||
| = | $ 13,840 |
ekkarill92 answered 2 years agoRelated Solutions
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