Question

The Blooming Miracles Flower Shop bought a delivery van on January 1, 2019.The van cost $18,000 and had an expected salvage value of $3,000. The life of the van was estimated to be five years or 150,000 miles. Using the straight-line method of depreciation, the book value of the van at the beginning of the third year would be

Answer 1

Answer:

12000

Step-by-step explanation:

Straight-line method of Depreciation = Cost - Salvage value

Year 1 useful life

Depreciation year 1 = 18000-3000

5years

Depreciation Year 1 =15000÷5

dep year 1 = 3000 , ( in straight line method depreciation remains constant in all the years)

Net Book Value year 1 = (18000-3000) = 15000

Dep Year 2 = 3000 , NBV= (15000-3000) = 12000

Beginning of ?Year 3 NBV = 12000