Sara's Designs Purchased Equipment at the Beginning of 2015 for $11,000.Sara

Multiple Choice

Sara's Designs purchased equipment at the beginning of 2015 for $11,000.Sara decided to depreciate the equipment over a 5-year period using the straight-line method.Sara estimated the equipment's residual value at $1,000.The estimated fair market value at the end of 2015 was $10,000.Which of the following statements is correct concerning Sara's financial statements at December 31, 2015?

A) The book value of the equipment is $7,200.
B) The book value of the equipment is $9,000.
C) The total accumulated depreciation is $2,200.
D) The equipment will be reported on the balance sheet at it fair market value of $10,000.