The reed company uses the straight-line method to depreciate its equipment. On may 1, 2007, the company purchased some equipment for $200,000. The equipment is estimated to have a useful life of ten years and a salvage value of $20,000. How much depreciation expense should Reed record for the equipment in the adjusting entry on December 31, 2007? a.$6,000 b.$12,000 c.$13,500 d.$18,000

Century 21 Accounting General Journal
11th Edition
ISBN:9781337680059
Author:Gilbertson
Publisher:Gilbertson
Chapter19: Accounting For Plant Assets, Depreciation, And Intangible Assets
Section: Chapter Questions
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The reed company uses the straight-line method to depreciate its
equipment. On may 1, 2007, the company purchased some equipment for
$200,000. The equipment is estimated to have a useful life of ten years
and a salvage value of $20,000. How much depreciation expense should
Reed record for the equipment in the adjusting entry on December 31,
2007?
a.$6,000
b.$12,000
c.$13,500
d.$18,000
Transcribed Image Text:The reed company uses the straight-line method to depreciate its equipment. On may 1, 2007, the company purchased some equipment for $200,000. The equipment is estimated to have a useful life of ten years and a salvage value of $20,000. How much depreciation expense should Reed record for the equipment in the adjusting entry on December 31, 2007? a.$6,000 b.$12,000 c.$13,500 d.$18,000
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