A contractor owns equipment with an original cost of $120,000 and accumulated depreciation of $45,000. What is the current book value of this equipment?
Correct Answer
B) $75,000
Book value = Original cost - Accumulated depreciation = $120,000 - $45,000 = $75,000. This represents the equipment's value on the company's financial statements.
Why This Is the Correct Answer
Book value = Original cost - Accumulated depreciation = $120,000 - $45,000 = $75,000. This represents the equipment's value on the company's financial statements.
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