Reference no: EM132843621

Tweedie Company reported the following in the long-term asset section of its balance sheet; assume that not PPE was purchased or sold during the period.

                                                                                           Dec. 31, Year 2                  Dec. 31, Year 1
Equipment, net of depreciation of $120,000 and 100,000, respectively     $167,500                   $187,500
Patent, net of amortization of $31,500 and $27,000, respectively               88,000                         92,500

Problem 1: The company uses the straight-line method to depreciate and amortize all of its operating assets. Assume the salvage value of the equipment is 10% of cost. What is the useful life of equipment? You may round to the nearest year year.

Select one:
a. 11
b. 13
c. 14
d. 12
e. 10