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thorton industries purchased a machine part-way through the year on July 1 for $45,000 and is...

thorton industries purchased a machine part-way through the year on July 1 for $45,000 and is depreciating it with the straight-line method over a life of 10 years, using a residual value of $3,000. Depreciation Expense for the machine for that year ended December 31 is:

a. $2,100
b. $2,250
c. $4,200
d. $4,500
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Answer #1

Cost of machine = $45,000

Useful life = 10 years

Residual value = $3,000

Annual depreciation expense = (Cost of machine-Residual value)/Useful life

= ( 45,000-3,000)/10

= $4,200

Depreciation expense for year 1 = 4,200 x 6/12

= $2,100

correct option is a.

Kindly comment if you need further assistance. Thanks‼!

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