A printer was purchased for $8,000 on 1 July 2019. Useful life was estimated as 3...

A printer was purchased for $8,000 on 1 July 2019. Useful life was estimated as 3 years and residual value as $2,000. (Assume financial year 1 July – 30 June).

What is the accumulated depreciation (using the straight line method) on 30 June 2021?

	a.	$6,000
	b.	$4,000
	c.	$2,000
	d.	None of the options are correct
	e.	$5,000

Expert Solution

Answer: b. $4,000

Explanation

	Straight Line Depreciation

	(Cost - Salvage Value)	/	Useful Life	=	Annual Depreciation
	(8,000 - 2,000)	/	3	=	$ 2,000.00

Year End	Annual Depreciation	x	Fraction of Year	=	Depreciation Expense
30-Jun-20	2,000.00	x	12/12	=	$ 2,000.00
30-Jun-21	2,000.00	x	12/12	=	$ 2,000.00
	Accumulated Depreciation				$ 4,000.00

ekkarill92 answered 2 years ago

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