[The following information applies to the questions displayed below.] On April 1

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[The following information applies to the questions displayed below.]

On April 1, 2016, Cyclone's Backhoe Co. purchases a trencher for $318,000. The machine is expected to last five years and have a salvage value of $59,000.

0 Required information The following information applies to the questions displayed below On April 1, 2016, Cyclone's Backhoe Co. purchases a trencher for $318,000. The machine is expected to last five years and have a salvage value of $59,000. Compute depreciation expense for both years ending December 2016 and 2017 assuming the company uses the straight-line method. Choose Numerator: | , | Choose Denominator: | = Annual Depreciat Annual depreciation Annual Depreciationration of YearDepreciation Year Annual Depreciation x 2016 2017 Fraction of Year Expense

Explanation / Answer

Cost minus salvage / Estimated useful life(years) = Annual depreciation 259000 / 5 = 51800 Year Annual depreciation X Fraction of year = Depreciation expense 2016 51800 X 9/12 = 38850 2017 51800 X 12/12 = 51800

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