An asset was purchased for $120,000 on january 1, year 1 and originally estimated to have a useful life of 10 years with a residual value of $10,000. at the beginning of the third year, it was determined that the remaining useful life of the asset was only four years with a residual value of $2,000. calculate the third-year depreciation expense using the revised amounts and straight-line method.

Depreciation Year 3 = $ 24000

Explanation:

Depreciation of year 1 using straight line method of depreciation

Dep Year 1 = Cost - Residual Value

                     Useful life

Dep Year 1 = 120,000-10,000

                       10years

Dep Year 1 = 11000

Dep Year 2 = 11000

In straight line method Depreciation amount remains constant in all years to follow

However in Year 3 residual amount and useful life were revised therefore depreciation amount also changed

Book Value at Year 3 = 120,000-22000

Book value Year 3 = 98000

Depreciation at Year 3 = book value- revised residua value

                                             revised useful life

Dep Year 3 = 98000-2000

                        4 years

Depreciation Year 3 = $24000

answer; human resource management.(hrm);

consumer credit. an advantage is that it allows consumers to afford expensive goods and services now, increasing their standard of living. however, a disadvantage is that it creates a trap for debt, if people do not have self control, they may see themselves filing personal bankruptcy.