On January 1, Truesdale, Inc., purchased a piece of machinery for use in operations. The total acquisition cost was $33,000. The machine has an estimated useful life of 3 years and a salvage value of $3,000. Using the straight-line method, the amount of depreciation that should be recorded during year 1, is approximately

Question

Leanna Wyatt

Business

28 March, 21:41

On January 1, Truesdale, Inc., purchased a piece of machinery for use in operations. The total acquisition cost was $33,000. The machine has an estimated useful life of 3 years and a salvage value of $3,000. Using the straight-line method, the amount of depreciation that should be recorded during year 1, is approximately

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Ryan Mcpherson · Answer 1

Annual depreciation = $10,000

Explanation:

Giving the following information:

The total acquisition cost was $33,000. The machine has an estimated useful life of 3 years and a salvage value of $3,000.

To calculate the depreciation expense under the straight-line method, we need to use the following formula:

Annual depreciation = (original cost - salvage value) / estimated life (years)

Annual depreciation = (33,000 - 3,000) / 3

Annual depreciation = $10,000