Question

If equipment cost $20,000 and accumulated depreciation amounts to $6,000, the book value of the equipment is?

Answers

  1. The book value of the equipment is $14000
    Given,
    equipment cost = $20,000
    depreciation amounts =  $6,000
    book value of the equipment = equipment cost – depreciation cost
    = 20000 – 6000
    = $14000

    What Are Depreciation Expenses?

    Depreciation expense, on the other hand, is the amortized portion of the cost of the business’s fixed assets during a certain period. Depreciation expense is recognized in the income statement as a non-cash expense that reduces the  net income or profit of the business. For accounting purposes, depreciation expense is debited and  accumulated depreciation is credited.
    Depreciation expenses are treated as non-cash expenses because periodic monthly amortization is  not involved in cash transactions.
    To learn more about depreciation amounts from given link
    #SPJ4

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