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Scrimshander, Inc. is a shipping company, transporting goods using cargo ships. On January 1, 2017, the company purchases and puts into service a cargo ship
Scrimshander, Inc. is a shipping company, transporting goods using cargo ships. On January 1, 2017, the company purchases and puts into service a cargo ship costing $10,000,000. The expected useful life of the ship is 25 years. Scrimshanderuses straight-line depreciation.
- Calculate theannualdepreciation expense that Scrimshander must recognize on the cargo ship over the next 25 years.
- Calculate the net book value of the cargo ship as of December 31, 2020.
- Calculate the net book value of the cargo ship as of December 31, 2041.
- Assume that Scrimshander continues using this cargo ship throughout 2042. How much depreciation expense should Scrimshander recognize for that year?
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