Question

depreciation methods susquehanna company purchased an asset at the beginning of the current year for $250,000. the estimated residual value is $25,000. susquehanna estimates that the asset will be used for 10 years and uses straight-line depreciation. calculate the depreciation expense per year. $fill in the blank 1 per year.

Answer 1

The Susquehanna Company should calculate an annual depreciation expense of $22,500 using the straight-line depreciation method by subtracting the residual value from the asset's cost and dividing by its useful life.

Step-by-step explanation:

The Susquehanna Company is calculating depreciation expense for an asset using the straight-line depreciation method. The formula for straight-line depreciation is (Cost of the asset - Residual Value) / Useful Life of the Asset. In this case, the cost of the asset is $250,000, the residual value is $25,000, and the useful life is estimated to be 10 years.

To calculate the annual depreciation expense:
1. Subtract the residual value from the cost of the asset: $250,000 - $25,000 = $225,000
2. Divide this amount by the useful life of the asset: $225,000 / 10 years = $22,500

Therefore, the annual depreciation expense is $22,500 per year.