Question

On Jan 1, 2003, a printer is purchased with a book value of $30,000 and an estimated useful life of 3 years and an estimated salvage value of $6,000. (1) What is the book value on December 31, 2004? (2) What is the balance of the accumulated depreciation account on December 31, 2004?

Answer 1

acc depreciation at december 31th 2004 16,000

Step-by-step explanation:

We will first calcualte the depreciaton per year on the printer:

acquisition - salvge value = subject to depreciation

30,000 - 6,000 = 24,000

Then depreciable amount / useful life = dep per year

24,000 / 3 = 8,000

on December 31, 2004 there will be two yeas of depreciation accumulated

8,000 dep for 2003

8,000 dep for 2004

16,000 acumulated depreciation

The book value will be:

30,000 acquisition

(16,000) acumulated depreciation

14,000 net book value