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Brinkman Corporation bought equipment on January 1, 2007 .The equipment cost $90,000 and had an expected salvage value of $15,000. The life of the equipment was estimated to be 6 years.

The depreciation expense using the straight-line method of depreciation is
a. $17,500
b. $18,000
c. $12,500
d. none of the above

User Mpounsett
by
8.7k points

1 Answer

7 votes

Answer:

C. $12,500

Step-by-step explanation:

Please keep in mind that, annual depreciation expense is caluclated as below:

Depreciation expenses = (Original cost - Salvage value)/Expected useful life

Putting all the number together, we have:

Depreciation expenses = (90,000 - 15,000)/6 = 12,500.

So the correct answer is C. $12,500

User Quazi Irfan
by
8.2k points
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