Equipment cost is $62,000, salvage value is $8,000, and useful life is 6 years. What annual straight-line depreciation is recorded?
Correct Answer
C) $9,000.
Depreciable base is $54,000. Annual depreciation is $54,000 / 6 = $9,000.
Why This Is the Correct Answer
Depreciable base is $54,000. Annual depreciation is $54,000 / 6 = $9,000.
Why the Other Options Are Wrong
Option A: $8,000.
$8,000. is below the supported result for depreciation; it likely uses the wrong base, period, or account bucket.
Option B: $8,500.
$8,500. is below the supported result for depreciation; it likely uses the wrong base, period, or account bucket.
Option D: $10,333.
$10,333. is above the supported result for depreciation; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Depreciable and base live in different drawers; Setting Equipment tells which opens.
Reference Hint
Study anchor (closed-book): memorize Depreciation from CSLB Law and Business Study Guide; CSLB 2026 Law Book / CSLB Law and Business Study Guide Business Finances; know the rule or calculation trigger without relying on exam-room lookup.
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