Question

On January 1, 2018, Truesdale, Inc., purchased a piece of machinery for use in operations. The total acquisition cost was $33,000. The machine has an estimated useful life of 3 years and a salvage value of $3,000. Using the straight-line method, the amount of depreciation that should be recorded during 2018, is approximately

$3,000
$10,000
$11,000
$30,000

Answer 1

The answer is B. $10,000

Step-by-step explanation:

Straight-line depreciation method equals:

[Historical cost of the asset - salvage value(if any)] ÷ useful number of years of the asset.

Historical cost of the asset = $33,000

Salvage value = $3,000

Useful life = 3 years

= ($33,000 - $3,000) ÷ 3 years

=$10,000

So the amount of depreciation that will be recorded during 2018 using the straight-line method is $10,000