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On October 1, 2021, Holt Company places a new asset into service. The cost of the...

On October 1, 2021, Holt Company places a new asset into service. The cost of the asset is $120,000 with an estimated 5-year life and $30,000 salvage value at the end of its useful life. What is the depreciation expense for 2021 if Holt Company uses the straight-line method of depreciation?

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Answer #1
cost of asset $        120,000
salvage value $          30,000
$          90,000
Life 5 years
Annual depreciation $          18,000
so if you have bought the asset in october
and considering the year ends in december
depreciation for 2021 will be 4500
(18000*3/12 months)

straight line method dep =(cost-salvage value)/useful life

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