A truck was purchased for $120,000 and it was estimated to have a $24,000 salvage value at the end of its useful life. A monthly depreciation expense of $2,000 was recorded using the straight-line method. The annual depreciation rate is: a. 20% b. 2% c. 8% d. 25%

A truck was purchased for $120,000 and it was estimated to have a $24,000 salvage value at the end of its useful life. A monthly depreciation expense of $2,000 was recorded using the straight-line method. The annual depreciation rate is: a. 20% b. 2% c. 8% d. 25%

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter18: Accounting For Long-term Assets

Section: Chapter Questions

Problem 3CE: A machine costing 350,000 has a salvage value of 15,000 and an estimated life of three years....

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Question

100%

What is the annual depreciation rate on these general accounting question?

A truck was purchased for $120,000 and it was estimated to have a $24,000
salvage value at the end of its useful life. A monthly depreciation expense
of $2,000 was recorded using the straight-line method. The annual
depreciation rate is:
a. 20%
b. 2%
c. 8%
d. 25%

Definition Video Definition Accounting method wherein the cost of a tangible asset is spread over the asset's useful life. Depreciation usually denotes how much of the asset's value has been used up and is usually considered an operating expense. Depreciation occurs through normal wear and tear, obsolescence, accidents, etc. Video

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