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A company has estimated the useful life of their automobiles as 5 years. If the company purchases an automobile on January 1 for $40,000 and
A company has estimated the useful life of their automobiles as 5 years. If the company purchases an automobile on January 1 for $40,000 and determines it could be sold for $2,500 at the end of the useful life.
If the company has a year-end of December 31 and uses the straight-line method of depreciation, the book value of the automobile at the end of year 2 would be:
a. $32,000.
b. $25,000.
c. $15,000.
d. $24,000.
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