On January 1, 2013, Zane Manufacturing Company purchased a machine for $40,000

Accounting Mar 18, 2021

On January 1, 2013, Zane Manufacturing Company purchased a machine for $40,000. The company expects to use the machine a total of 24,000 hours over the next 6 years. The estimated sales price of the machine at the end of 6 years is $4,000. What is depreciation expense for 2014 if the company uses straight-line depreciation?

a. $ 6,000

b. $ 9,000

c. $13,333

d. $10,000

Expert Solution

Answer:

a .

Step-by-Step explanation

Depreciation expense = (Machine's cost - Estimates SP) ?×? 1/6 × 12/12

= ($40,000 - $4,000) × 1/6 × 12/12

= $6,000

Hence, option a is correct.

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