Equipment Was Purchased for $50,000, Residual Value Is $2,000 and It

question 44

Short Answer

Equipment was purchased for $50,000, residual value is $2,000 and it is expected that the useful life is 10 years. What is the book value of the equipment after the third year assuming straight-line depreciation?
$ ________

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Definitions:

Stockholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities, often divided into share capital and retained earnings.

Common Stock

A type of equity security that denotes ownership in a corporation, entitling the holder to a claim on part of the company's profits in the form of dividends and voting rights.

Common Stock Account

An equity account that represents the ownership interests of common shareholders in a company.

Stated Value

A value assigned to a company's no-par value stock by the company’s board of directors.