Justice Company Purchased a Machine for $15,000 Two Years Ago

question 60

Multiple Choice

Justice Company purchased a machine for $15,000 two years ago.The machine had no residual value and had an estimated useful life of 10 years.If the company uses the straight-line depreciation method,calculate the current book value of the machine.

• A) $12,000
• B) $3,000
• C) $16,500
• D) $15,000

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Definitions:

Apparent Authority

An agent’s ability to affect the principal’s legal relations. Consent must be communicated to the third party.

Restatement (Third)

The third update to a set of model civil and criminal statutes designed to clarify, modernize, and otherwise improve American law.

Renunciation

Occurs when either party manifests to the other that he does not wish the agency to continue. This is done by the agent.

Revocation

The act of withdrawing, cancelling, or annulling a legal right, license, or agreement formally and officially.