Answered

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On October 1, Illini Company purchased a truck for $42,000. The truck is expected to have a salvage value of $3,000 at the end of its 3-year useful life. If the company uses the straight-line method, the depreciation expense recorded during the year ending December 31, will be:

Sagot :

Galaxystarsha

Answer:

Will be: 3,250

Explanation:

Cost of truck = $42,000

Salvage value = $3,000

Value to be depreciated = $42,000 - $3,000

                                        = $39,000

If the asset has a useful life of 3 years,

Yearly depreciation = $39,000/3

                                = $13,000

For 2019, the asset is used between October 1 and December 31 (3 months)

Therefore,

Depreciation expense for the year ending December 31, 2019

= (3/12) × $13,000

=$3,250

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