An Asset Was Purchased for $120,000 on January 1, Year

question 222

Multiple Choice

An asset was purchased for $120,000 on January 1, Year 1 and originally estimated to have a useful life of 10 years with a residual value of $10,000. At the beginning of the third year, it was determined that the remaining useful life of the asset was only four years with a residual value of $2,000. Calculate the third-year depreciation expense using the revised amounts and straight-line method.

• A) $25,000
• B) $11,000
• C) $24,000
• D) $24,500

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