What amount of depreciation expense

Reference no: EM13129440

Twohig Company leased a piece of equipment from Wells, Corp. on January 1, 2011 for $300,000. The lease term is for seven years and the life of the asset is 10 years. The lease also contains a $10,000 bargain purchase option, which Twohig is expected to exercise at the end of the lease period. Assuming that the salvage value of the equipment is $20,000, what amount of depreciation expense would Twohig recognize each year?

$28,000

$29,000

$40,000

$41,428.57

Reference no: EM13129440

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