Asked by
Bernadeth Apolinares
on Dec 16, 2024
Verified
On October 1 2017 Holt Company places a new asset into service. The cost of the asset is $120000 with an estimated 5-year life and $30000 salvage value at the end of its useful life. What is the depreciation expense for 2017 if Holt Company uses the straight-line method of depreciation?
A) $4500
B) $24000
C) $6000
D) $12000
Straight-Line Method
The straight-line method is a depreciation technique that allocates an equal amount of depreciation expense for a fixed asset to each year of its useful life.
Salvage Value
The estimated market valuation of an asset following the end of its useful duration.
Depreciation Expense
The charge to the income statement for a particular period that represents the allocation of the cost of tangible assets over their useful lives.
- Familiarize yourself with the essential doctrines and procedures of asset depreciation, including the multiple forms of depreciation calculation.
- Recognize the importance of matching the depreciation method with the asset's use and its contribution to revenue over its useful life.
Verified Answer
DG
Learning Objectives
- Familiarize yourself with the essential doctrines and procedures of asset depreciation, including the multiple forms of depreciation calculation.
- Recognize the importance of matching the depreciation method with the asset's use and its contribution to revenue over its useful life.