18

On June 1, Michael Company purchased equipment at a cost of $120,000 that has a depreciable cost of $90,000 and an estimated useful life of 3 years or 30,000 hours. Using straight-line depreciation determine which of the following is the proper adjusting journal entry for the second year. Depreciation Expense $15,000 Accumulated Depreciation $15,000 Accumulated Depreciation $12,500 Depreciation Expense $12,500 $30,000 Depreciation Expense Accumulated Depreciation $30.000 Equipment Expense $40,000 Accumulated Depreciation $40,000