Use the following data: $$\begin{array} { l r }
\text { Asset cost } & \$ 120,000 \
\text { Expected life } & 3 \text { years } \
\text { Estimated salvage value } & \$ 15,000
\end{array}$$ ? Using the straight-line method, the amount of depreciation each year would be
A) $35,000.
B) $40,000.
C) $45,000.
D) $15,000.

Question

Use the following data: $$\begin{array} { l r } 
\text { Asset cost } & \$ 120,000 \
\text { Expected life } & 3 \text { years } \
\text { Estimated salvage value } & \$ 15,000
\end{array}$$ ? Using the straight-line method, the amount of depreciation each year would be
A) $35,000.
B) $40,000.
C) $45,000.
D) $15,000.

Quizplus · Accepted Answer

The straight-line depreciation method calculates annual depreciation by subtracting the salvage value from the asset cost and dividing by the asset's useful life: $(\$120,000 - \$15,000) / 3 = \$35,000$.

Use the Following Data ? Using the Straight-Line Method, the Amount of Depreciation Each