Holly Inc has a building that originally cost 562500 Holly e

Holly, Inc. has a building that originally cost $562,500. Holly expects to be able to sell the facility for $160,500 at the end of its useful life. The balance of the related Accumulated Depreciation account is $387,000. The residual value of the facility is:

Multiple Choice

$175,500.

$226,500.

$402,000.

$160,500.

Solution

Residual Value = Original Cost - Accumulated Depreciation

= $ 562,500 - $ 387,000

= $ 175,500

Hence the correct answer is $ 175,500