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QUESTION

) On Jan 1 of Year 1, Cameron Company purchased a sophisticated piece of equipment costing $300,000. The equipment had a 30,000 salvage value and a...

15.) On Jan 1 of Year 1, Cameron Company purchased a sophisticated piece of equipment costing $300,000. The equipment had a 30,000 salvage value and a 10 year estimated useful life. As on Jan 1 of Year 4, technology has changed and it is feared that the value has been impaired. On January 1 of Year 4 it is projected that the equipment has a remaining useful life of 4 years, a salvage of zero, and that it will generate cahs flows of 45,000 at the end of each year for the next 4 years. The market interest rate is 10%. How much depreciation expense will Cameron Company recognize on this piece of equipment during Year 4? Using straight line depreciation.

A. 39,413

B. 42,784

C. 71,595

D. 35,661

E. 45,826

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