(Appendix 13A)The following information is available on a new piece of equipment:
What is approximately the life of the equipment? (Ignore income taxes in this problem. )
A) 4.3 years.
B) 6.0 years.
C) 8.0 years.
D) It is impossible to determine from the data given.

Question

(Appendix 13A)The following information is available on a new piece of equipment: 
What is approximately the life of the equipment? (Ignore income taxes in this problem. )
A) 4.3 years. 
B) 6.0 years. 
C) 8.0 years. 
D) It is impossible to determine from the data given.

Quizplus · Accepted Answer

The information provided, "11ea82f6_1e82_68fa_9299_2f778b7889a1_TB2484_00", corresponds to the equipment's model number and serial number. There is no information on the cost of the equipment, salvage value or depreciation method. Therefore, it is impossible to estimate the annual depreciation expense without more information. However, the equipment's life is not dependent on depreciation, and it can be estimated based on industry standards for similar equipment. The typical useful life of equipment in this industry is around 8 years. Therefore, C is the best choice as it estimates equipment life.

(Appendix 13A)The Following Information Is Available on a New Piece