Answer:
The correct answer is $735
Explanation:
Solution
Given that:
Now,
The first step is to find How much depreciation expense will be recorded for the furniture for the first year ended December 31.
Thus,
The depreciation for a complete year under the method called straight line is given as follows:
The depreciation for a complete year under the method called straight line =(Cost -Salvage Value)/ Useful life
=($17,000 -$2,300) /5
=$14700/5
= $2940 per year
However,
Because the furniture was purchased on September 30, the depreciation will be computed from October to December (three months)
The depreciation for three months is shown below:
Depreciation = Yearly deprecation * 3/12
= $2940 * 3 /12
= $8820/12
=$735
