Accounting for IGCSE & O level - Accounting Procedures (Section 12 - No. 2)
If a company purchases equipment for $80,000, the estimated useful life is 5 years, and the residual value is $10,000. Calculate the annual depreciation expense, using the straight-line method.
$14,000
$16,000
$70,000
$80,000
Explanation
($80,000 - $10,000) / 5 years = $14,000.
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