Final answer:
The annual depreciation expense for the first year using the straight-line method is calculated by subtracting the salvage value from the cost and dividing by the vehicle's useful life. For the given vehicle with a cost of $46,000, salvage value of $7,000, and useful life of 6 years, the first year's expense is $6,500.
Step-by-step explanation:
To calculate the depreciation expense for the first year using the straight-line method, one would subtract the salvage value from the initial cost and then divide by the useful life of the vehicle. The formula is:
Annual Depreciation Expense = (Cost - Salvage Value) / Useful Life.
Using the provided values:
- Cost = $46,000,
- Salvage Value = $7,000,
- Useful Life = 6 years.
The calculation is:
Annual Depreciation Expense = ($46,000 - $7,000) / 6 = $39,000 / 6 = $6,500.
Therefore, the depreciation expense for the first year to the nearest dollar is $6,500. The annual depreciation expense for the first year using the straight-line method is calculated by subtracting the salvage value from the cost and dividing by the vehicle's useful life. For the given vehicle with a cost of $46,000, salvage value of $7,000, and useful life of 6 years, the first year's expense is $6,500.