STRAIGHT-LINE DEPRECIATION Original Estimated Estimated Total Cost – Salvage Value = Depreciation Expense     $1,250.00 – $250.00 = $1,000.00 Estimated Years of Annual Total Depreciation Estimated Depreciation Expense ÷ Useful Life = Expense $1,000.00 ÷ 5 = $200.00 Lesson 21-2, page 550

CALCULATING DEPRECIATION EXPENSE FOR PART OF A YEAR Annual Months Monthly Depreciation in a Depreciation Expense ÷ Year = Expense     $900.00 ÷ 12 = $75.00 Monthly Number of Partial Year’s Depreciation Months Asset Depreciation Expense  Is Used = Expense $75.00  5 = $375.00 Lesson 21-2, page 550

CALCULATING ACCUMULATED DEPRECIATION 20X2 20X3 20X3 Accumulated Depreciation Accumulated Depreciation + Expense = Depreciation     $400.00 + $200.00 = $600.00 CALCULATING BOOK VALUE Original Accumulated Ending Cost – Depreciation = Book Value $1,250.00 – $600.00 = $650.00 Beginning Annual Ending Book Value – Depreciation = Book Value $850.00 – $200.00 = $650.00 Lesson 21-2, page 551

TERMS REVIEW depreciation expense estimated salvage value straight-line method of depreciation accumulated depreciation book value of a plant asset Lesson 21-2, page 552