A Company Used Straight-Line Depreciation for an Item of Equipment

question 146

Multiple Choice

A company used straight-line depreciation for an item of equipment that cost $12,000,had a salvage value of $2,000 and a five-year useful life.After depreciating the asset for three complete years,the salvage value was reduced to $1,200 but its total useful life remained the same.Determine the amount of depreciation to be charged against the equipment during each of the remaining years of its useful life.

• A)$1,000
• B)$1,800
• C)$5,400
• D)$2,400
• E)$2,000

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Definitions:

Confidence Interval

A span of numbers, calculated from observed data statistics, that probably encompasses an unknown parameter of a population.

Sample

A group or set collected from a larger population for the purpose of statistical analysis, representing the larger group.

Hypothesis Testing

A statistical method that uses sample data to evaluate a hypothesis about a population parameter.