Explanation Useful life: The period for which a depreciable fixed asset is expected to generate revenue for a company is referred to as useful life. Determine the useful life of an asset: Useful life of an asset = Depreciable cost Annual depreciation expense = $ 25 , 000 $ 5 , 000 =5 years The useful life of an asset will be five years because the value of accumulated depreciation is $10,000 for two years, out of which $5,000 is charged as annual depreciation for each year. Working note 1: Determine the useful life of an asset

3rd Edition

ISBN: 9780133791129

Author: Jane L. Reimers

Publisher: Pearson Higher Ed

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Solution Summary: The author identifies the useful life of an asset. The value of accumulated depreciation is 10,000 for two years, out of which 5,000 is charged annually.

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