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College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

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BuyFindarrow_forward

College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756
Textbook Problem

CALCULATION OF BOOK VALUE On June 1, 20--, a depreciable asset was acquired for $6,840. The asset has an estimated useful life of six years (72 months) and no salvage value. Using the straight-line depreciation method, calculate the book value as of December 31, 20--.

To determine

Calculate the book value as of December 31 by using the straight-line depreciation method.

Explanation

Book value:

It is the value of an asset on the balance sheet by reducing the accumulated depreciation of an asset with the cost of that asset.

Calculate the book value as of December 31 by using the straight-line depreciation method.

Book value = Cost of the assetAccumulated depreciation=$6,840$665(1)=$6,175

Therefore, the book value of the asset as of December 31 is $6,175

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