What should the basis be for depreciation of the plant

Reference no: EM13123106

In 1995, Wallet Manufacturing Company constructed a plant for $500,000. In 2005, the following expenditures were made related to the plant: New roof -$20,000, Changing the useful life from 20 to 25 years, Painting - $10,000, Property tax - $25,000. A full year of depreciation has been taken on the plant each year since 1995 using straight-line depreciation. Assume the residual value remains $50,000. What should the basis be for depreciation of the plant in 2005?

Answer

$275,000

$295,000

$305,000

$330,000

Reference no: EM13123106

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