Annual depreciation= $13,260
Book value= $48,480
Purchase price= $75,000
Useful life= 5 years
Salvage value= $8,700
calculate the depreciation expense,
Annual depreciation= (original cost - salvage value)/estimated life (years)
Annual depreciation= (75,000 - 8,700) / 5
Annual depreciation= $13,260
the book value:
Book value= purchase price - accumulated depreciation
Book value= 75,000 - (13,260*2)
Book value= $48,480
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