Reference no: EM131793319

Question - On January 1 of year 1, Cameron Company purchased a sophisticated piece of equipment costing $300,000. The equipment had a $30,000 salvage value and a 10 year estimated useful life. As January 1 of year 4 technology has changed, and it is feared that the value of this sophisticated piece of equipment has been impaired. On January 1 of year 4, it is projected that the equipment has a remaining useful life of 4 years, a salvage value of zero, and that will generate cash flows of $45,000 at the end of each year for the next 4 years. The market interest rate is 10%. How much depreciation expense will cameron company recognize on this piece of equipment during year 4? Note: impairment losses are not classified as part of depreciation expense. Cameron uses straight line depreciation.