Question: 1. Identify the asset class for each of the following:
(a) supplies,
(b) office equipment,
(c) inventory,
(d) land for future expansion, and (e) trucks used in operations.
2. On January 1, 2011, a company pays $77,000 to purchase office furniture with a zero salvage value. The furniture's useful life is somewhere between 7 and 10 years. What is the year 2011 straight-line depreciation on the furniture using
(a) a 7-year useful life and
(b) a 10-year useful life?
3. What does the term depreciation mean in accounting?