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Calculate The first year of depreciation on a residential building costing $250,000, purchased June 2, 2019

Calculate The first year of depreciation on a residential building costing $250,000, purchased June 2, 2019

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Expert Solution

Since it's a residential property, therefore we will consider the depreciation rate for the first year of purchase in the month of June to be 1.970% because the building was purchased in that month only The depreciation rate can be known through a table from the internet sources and consider table 7.4 in this case.(http://cxp.cengage.com/contentservice/assets/T=1467295792958/whit1itf34h/images/ch07/tables_7-2_7-3_7-4.html) .

Depreciation = Cost value of building x Depreciation rate

= $ 250000 x 1.970%

= $4925

Therefore, depreciation expense would be $4925 for the first year on a residential building costing $250000 purchased June 2, 2019.

ekkarill92 answered 2 years ago
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