On January 1,2016,stewart Corporation Purchased Equipment for $120,000

Question 151
Essay

On January 1,2016,Stewart Corporation purchased equipment for $120,000.A discount of 2% was granted on the equipment;the shipping terms were FOB shipping point,and the freight cost was $3,000.Installation and testing costs amounted to $4,000.The equipment had an estimated useful life of 4 years and salvage value of $10,000.At the beginning of 2018,Stewart revised the expected life of the asset to six years and the salvage value to $12,000. Required: Compute the depreciation expense using straight-line method for each of the six years.