A pickup purchased for $54,000 has accumulated depreciation of $21,600. What book value remains?
Correct Answer
C) $32,400
Book value is cost less accumulated depreciation.
Why This Is the Correct Answer
Book value is cost less accumulated depreciation.
Why the Other Options Are Wrong
Option A: $21,600
$21,600 is below the supported result for equipment book value; it likely uses the wrong base, period, or account bucket.
Option B: $27,000
$27,000 is below the supported result for equipment book value; it likely uses the wrong base, period, or account bucket.
Option D: $75,600
$75,600 is above the supported result for equipment book value; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Equipment Book Value drawer for Checking Fixed-Asset: label cost before counting dollars.
Reference Hint
Open-book path: tab Builder's Guide to Accounting, 2001 to Section Two, Equipment Records, Depreciation and Depreciation Methods; use the job ledger figures in the stem and recompute the same accounting measure.
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