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Stilton Industries purchased and placed in service equipment costing $50,000 on January 1, 2016. The equipment was expected to last 8 years and to have
Stilton Industries purchased and placed in service equipment costing $50,000 on January 1, 2016. The equipment was expected to last 8 years and to have no salvage value. The factory manager revised the estimate of the equipments useful life on January 1, 2020. The equipment was now expected to last another 8 years (a useful life of 12 years in total). The company used the straight-line method to depreciate factory equipment. What is the new annual depreciation expense amount?
Select one:
a. $3,125
b. $6,250
c. $4,167
d. $2,083
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