Asked by Khristy Ramirez on Jun 30, 2024
Verified
In calculating depreciation, residual value is
A) the fair value of the asset on the date of acquisition.
B) subtracted from accumulated depreciation to determine the asset's depreciable cost.
C) an estimate of the asset's value at the end of its useful life.
D) ignored in all the depreciation methods.
Residual Value
The estimated salvage value of an asset at the end of its useful life.
Depreciable Cost
The original cost of an asset less its salvage value, representing the total amount that can be depreciated over its useful life.
- Recognize the elements and factors necessary for calculating depreciation expense.
- Acquire knowledge on the concept of salvage (residual) value as it applies to depreciating assets.
Verified Answer
ZK
Zybrea KnightJul 04, 2024
Final Answer :
C
Explanation :
Residual value, also known as salvage value, is an estimate of the asset's value at the end of its useful life. It is considered when calculating depreciation to determine the total amount that will be depreciated over the asset's useful life.
Learning Objectives
- Recognize the elements and factors necessary for calculating depreciation expense.
- Acquire knowledge on the concept of salvage (residual) value as it applies to depreciating assets.
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