The amount of depreciation expense for the first full year of use of a fixed asset costing $95,000,with an estimated residual value of $5,000 and a useful life of 5 years,is $18,000 by the straight-line method.

Question

Quizplus · Accepted Answer

The straight-line method of depreciation calculates the same amount of depreciation expense for each year of the asset's useful life. Using the given information, the depreciable cost of the asset is $95,000 - $5,000 = $90,000. Dividing this by the useful life of 5 years gives an annual depreciation expense of $18,000. Therefore, the amount of depreciation expense for the first full year of use is $18,000.

The Amount of Depreciation Expense for the First Full Year