Answer:
The answer is $28,000
Explanation:
straight-line depreciation method =
( original cost of the asset minus salvage/residual value) ÷ number of useful life
Cost of the asset is $38,000
Residual value is $3,000
Number of use life is 7 years
($38,000 - $3,000) ÷ 7 years
= $5,000
Depreciation is $5,000 per year.
January 1, 2019 through
December 31, 2020 is 2 years.
That means accumulated depreciation is $10,000 ( $5,000 x 2 years)
Book value = cost of the asset - accumulated depreciation
$38,000 - $10,000
Book value = $28,000
