Standard company constructed a building which costs 13650000. Weighted-average accumulated expenditures was amounted to 5600000, actual interest amount was at 562,000. Avoidable interest was 272,000. If the salvage value is 1150000, and the useful life is 40 years, depreciation expense for the first full year using the straight-line method(SLM) is A.319,300 B.348,050 C.326,100 D.459,300
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
Standard company constructed a building which costs 13650000.
Weighted-average accumulated expenditures was amounted to 5600000, actual interest amount was at 562,000.
Avoidable interest was 272,000.
If the salvage value is 1150000, and the useful life is 40 years,
A.319,300
B.348,050
C.326,100
D.459,300
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