Homework SoursePeavey Enterprises purchased a depreciable asset for 22000 o
Peavey Enterprises purchased a depreciable asset for $22,000 on January 1, Year 1. The asset will be depreciated using the straight-line method over its five-year useful life. Assuming the asset\'s salvage value is $2,000, Peavey Enterprises should recognize depreciation expense in Year 2 in the amount of:
$4,000
$20,000
$5,000
$10,000
Which of the following are principles of the AICPA Code of Professional Conduct? (Mark all that apply)
Conservatism
Integrity
Due Care
Objectivity and Independence
| $4,000 | ||
| $20,000 | ||
| $5,000 | ||
| $10,000 |
Solution
1)
Annual depreciation under SLM = (Asset cost-Salvage value)÷Useful life of asset
= ($22,000-$2,000)÷5
= $20,000÷5
= $4,000
Hence, correct option is $4,000.
2)
Integrity refers to the following ethical principles. This the main idea behind formation of AICPA.
Hence, correct option is \"Integrity\"
