A computer equipment was acquired at the beginning of the year at a cost of $56,000 with an estimated residual value of $5,000, and an estimated useful life of 5 years. Determine the second year's depreciation expense using the straight-line method.

The second year's depreciation expense using the straight-line method is $10,200

Explanation:

Depreciation is the systematic allocation of the cost of an asset to the income statement based on the estimated useful life of the asset.

Depreciation = (cost - salvage value)/estimated useful life

where the salvage value is the estimate of the amount that will be received from the disposal of the asset after its useful life.

Annual depreciation

= ($56,000 - $5,000)/5

= $10,200

$10,200

Explanation:

Deprecation is way of expensing the cost of an asset.

Deprecation expense using the straight line depreciation method =( Cost of asset - residual value) / useful life

($56,000 - $5,000) / 5 = $10,200

The depreciation expense each year is $10,200.

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