Question

Rollins Company purchased a depreciable asset for $500,000 on April 1, 2010. The estimated salvage value is $50,000, and the estimated total useful life is 5 years. The straight-line method is used for depreciation. What is the balance in accumulated depreciation on May 1, 2013 when the asset is sold?

Question 4 options:

	$277,500
	$247,500
	$210,000
	$196,667

Answer 1

	Depreciation expense
	(500,000-50000)/5
	90000
	April 1,2010 to dec 31,2010				67500
	1 jan 2011 to dec 31,2011				90,000
	1 jan 2012 to dec 31,2012				90,000
	1 jan 2013 to may 1,2013				30000
	total accumulated depreciation				277500	answer