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A Capital Equipment Costing $400,000 Today Has No (Zero) Salvage

Question 42

Multiple Choice

A capital equipment costing $400,000 today has no (zero) salvage value at the end of 5 years. If straight-line depreciation is used, what is the book value of the equipment at the end of three years?


A) $120,000
B) $80,000
C) $160,000
D) $240,000

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