Canliss Mining Uses the Retirement Method to Determine Depreciation on Its

question 8

Multiple Choice

Canliss Mining uses the retirement method to determine depreciation on its office equipment. During 2016, its first year of operations, office equipment was purchased at a cost of $14,000. Useful life of the equipment averages four years and no salvage value is anticipated. In 2018, equipment costing $5,000 was sold for $600 and replaced with new equipment costing $6,000. Canliss would record 2018 depreciation of:

• A) $3,500.
• B) $4,400.
• C) $5,400.
• D) None of these answer choices are correct.