Answer:
Annual depreciation= $12,970
Explanation:
Giving the following information:
Kansas Enterprises purchased equipment for $72,500 on January 1, 2021. The equipment is expected to have a five-year service life, with a residual value of $7,650 at the end of five years.
To calculate the depreciation expense under the straight-line method, we need to use the following formula:
Annual depreciation= (original cost - salvage value)/estimated life (years)
Annual depreciation= (72,500 - 7,650)/5
Annual depreciation= $12,970
