doorglam paid $42,000 for office furniture. the furniture is depreciated using the straight - line method…

doorglam paid $42,000 for office furniture. the furniture is depreciated using the straight - line method and has an estimated service life of 7 years and no residual value. after three years of use, the accumulated depreciation of the furniture will be: a. $24,000 b. $36,000 c. $18,000 d. $42,000

doorglam paid $42,000 for office furniture. the furniture is depreciated using the straight - line method and has an estimated service life of 7 years and no residual value. after three years of use, the accumulated depreciation of the furniture will be: a. $24,000 b. $36,000 c. $18,000 d. $42,000

Answer

Explanation:

Step1: Calculate annual depreciation

The formula for straight - line depreciation is (Depreciation\ per\ year=\frac{Cost - Residual\ value}{Useful\ life}). Given (Cost = 42000), (Residual\ value=0), (Useful\ life = 7) years. So, (Depreciation\ per\ year=\frac{42000 - 0}{7}=6000).

Step2: Calculate accumulated depreciation after 3 years

The formula for accumulated depreciation is (Accumulated\ depreciation=Depreciation\ per\ year\times Number\ of\ years). Here, (Depreciation\ per\ year = 6000) and (Number\ of\ years = 3). So, (Accumulated\ depreciation=6000\times3 = 18000).

Answer:

C. $18,000