Using the straight-line method-salvage value

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Reference no: EM13825488

A truck costing $45,000 and having an estimated salvage value of $4,500 and an original life of five years is exchanged for a new truck. The cash price of the new truck is $57,000, and a trade-in allowance of $22,500 is received. The old truck has been depreciated for three years using the straight-line method. The new truck would be recorded at:

a. $55,200

b. $57,000

c. $34,500

d. $43,200

e. None of the above

Reference no: EM13825488

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