Financial Accounting Quiz

MobileT inc. purchased equipment for $100,000 on January 1, Year 1. The equipment had an estimated 10-year useful life and a $20,000 salvage value. Carr uses the straight-line depreciation method. In its Year 2 income statement, what amount should Carr report as depreciation expense for the equipment?

A) $2,000

B) $8,000

C) $10,000

D) $12,000

Reveal the Answer

The answer is B) $8,000

($100,000-$20,000)/10 = $8,000

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