Answer:
B. $1,667
Explanation:
The computation of the depreciation expense under the straight-line method is shown below:
= (Purchase cost of a delivery van - salvage value) ÷ (estimated useful life)
= ($28,000 - $3,000) ÷ (5 years)
= ($25,000) ÷ (5 years)
= $5,000
This is a full ear depreciation
Since the delivery van is purchased on September 1 and the company recognize on December 31. So there is a difference of four months. So four months depreciation would be
= $5,000 × 4 months ÷ 12 months
= $1,667
