A small equipment has first cost of $20,000 and a 10-year estimated life. The estimated salvage...

 

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A small equipment has first cost of $20,000 and a 10-year estimated life. The estimated salvage value of the equipment is zero at the end of 10 years. Calculate depreciation cost during the fifth year, cumulative depreciation cost through the fifth year, and book value at the end of fifth year with these methods. a) Straight line depreciation b) Double Declining balance c) Sinking method (i-8%) A small equipment has first cost of $20,000 and a 10-year estimated life. The estimated salvage value of the equipment is zero at the end of 10 years. Calculate depreciation cost during the fifth year, cumulative depreciation cost through the fifth year, and book value at the end of fifth year with these methods. a) Straight line depreciation b) Double Declining balance c) Sinking method (i-8%)

Answer rating: 100% (QA)

SOLUTION a Straight line depreciation The annual depreciation expense for straight line depreciation is calculated as follows Annual depreciation expense Cost Salvage value Useful life Annual deprecia... View the full answer