medium · Financial Accounting assets

On January 1, 2024, Zenith Corp purchased equipment for $220,000 with a $20,000 salvage value and an 8-year useful life. After 3 full years of straight-line depreciation, Zenith determines the equipment will only last 2 more years (5 years total) and the salvage value is now estimated at $10,000.

What is the depreciation expense for 2027?

  1. $72,500
  2. $42,000
  3. $25,000
  4. $67,500

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