Respuesta :
Answer:
$2,091,000 per year
Explanation:
Data provided in the question;
Purchasing cost of the machine = $10.4 million
Transportation cost = $55,000
Salvage value = 0
Depreciable life = 5 years
Now,
Total cost of the machine involved
= Purchasing cost of the machine + Transportation cost
= $10.4 million + $55,000
= $10,400,000 + $55,000
= $10,455,000
thus,
using the straight line method of depreciation
Annual depreciation = [tex]\frac{\textup{Total cost - Salvage value}}{\textup{Useful life}}[/tex]
Annual depreciation = [tex]\frac{\textup{$10,455,000 - 0}}{\textup{5}}[/tex]
or
Annual depreciation = $2,091,000
Hence,
Depreciation expenses associated with this machine is $2,091,000 per year
