White Mountain Supply Company purchases warehouse shelving for $18,200. Shipping
ID: 3216357 • Letter: W
Question
White Mountain Supply Company purchases warehouse shelving for $18,200. Shipping charges were $370, and assembly and setup amounted to $615. The shelves are expected to last for 9 years and have a scrap value of $3,900. Using the straight-line method of depreciation,
a. What is the annual depreciation expense of the shelving? Round your answer to the nearest cent. Use rounded answer value for subsequent calculations.
$
b. What is the accumulated depreciation after the third year? Round your answer to the nearest cent.
$
c. What is the book value of the shelving after the fifth year? Round your answer to the nearest cent.
$
Explanation / Answer
Cost of Shelve
18200
Shifting Charges
370
Set up Charges
615
Total Cost
19185
Life
9 years
Salvage Value
3900
Straight Line method
Depreciation Value
(Asset Cost - salvage value)
Depreciation Pewrcent
100/Life
Depreciation formula
Depreciation Value/Life
Depreciation Value
15285
Deprciation Percent
11.11111
Depreciation per year
1698.333
Year
Beginning Book Value
Depreciation Amount
Accumulated Depreciation Amount
Ending Book Value
1
19185
1698.33
1698.33
17486.67
2
17486.67
1698.33
3396.67
15788.33
3
15788.33
1698.33
5095.00
14090.00
4
14090.00
1698.33
6793.33
12391.67
5
12391.67
1698.33
8491.67
10693.33
6
10693.33
1698.33
10190.00
8995.00
7
8995.00
1698.33
11888.33
7296.67
8
7296.67
1698.33
13586.67
5598.33
9
5598.33
1698.33
15285.00
3900.00
Answers to the questions
Cost of Shelve
18200
Shifting Charges
370
Set up Charges
615
Total Cost
19185
Life
9 years
Salvage Value
3900
Straight Line method
Depreciation Value
(Asset Cost - salvage value)
Depreciation Pewrcent
100/Life
Depreciation formula
Depreciation Value/Life
Depreciation Value
15285
Deprciation Percent
11.11111
Depreciation per year
1698.333
Year
Beginning Book Value
Depreciation Amount
Accumulated Depreciation Amount
Ending Book Value
1
19185
1698.33
1698.33
17486.67
2
17486.67
1698.33
3396.67
15788.33
3
15788.33
1698.33
5095.00
14090.00
4
14090.00
1698.33
6793.33
12391.67
5
12391.67
1698.33
8491.67
10693.33
6
10693.33
1698.33
10190.00
8995.00
7
8995.00
1698.33
11888.33
7296.67
8
7296.67
1698.33
13586.67
5598.33
9
5598.33
1698.33
15285.00
3900.00
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