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15 December, 17:17

Gomez Company purchases a piece of equipment on Jan. 2, 2014, for $30,000. The equipment has an estimated life of eight years or 50,000 units of production and an estimated residual value of $3,000. Lester uses a calendar fiscal year. Using the straight-line method, what is the depreciation expense for 2014?

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  1. 15 December, 17:43
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    Depreciation expense for 2014 = $3,375

    Explanation:

    Given:

    Equipment cost = $30,000

    Estimated life = 8 years or 50,000 units

    Estimated residual value = $3,000

    Find:

    Depreciation expense for 2014 = ?

    Computation:

    Depreciation = (Equipment cost - Estimated residual value) / Estimated life

    Depreciation expense for 2014 = ($30,000 - $,3000) / 8

    Depreciation expense for 2014 = ($27,000) / 8

    Depreciation expense for 2014 = $3,375Answer:

    Depreciation expense for 2014 = $3,375

    Explanation:

    Given:

    Equipment cost = $30,000

    Estimated life = 8 years or 50,000 units

    Estimated residual value = $3,000

    Find:

    Depreciation expense for 2014 = ?

    Computation:

    Depreciation = (Equipment cost - Estimated residual value) / Estimated life

    Depreciation expense for 2014 = ($30,000 - $,3000) / 8

    Depreciation expense for 2014 = ($27,000) / 8

    Depreciation expense for 2014 = $3,375
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