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Question 1.) A corporation purchases a piece of property that will be depreciated using the straight line method of depreciation. The asset is purchased for $60,000 and it has a salvage value of $10,000. What will be the amount of annual depreciation allowed for this piece of property if its estimated useful life is four years?
Question 2.) A restaurant is purchasing an adjoining piece of land to be used to expand the restaurant's parking area. The land cost is $85,000. Grading and leveling the land will cost $10,000. Paving the lot will cost $45,000. Signage and line painting will cost $8,000. Installing overhead lighting will cost $15,000. Landscaping the lot will cost $4,000. Assuming no salvage value, what amount of this parking lot project can be depreciated by the restaurant's owners?
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