Acompany purchased a new delivery van at a cost of $45,000 on july 1. the delivery van is estimated to have a useful life of 6 years and a salvage value of $3,000. the company uses the straight-line method of depreciation. how much depreciation expense will be recorded for the van during the first year ended december 31?

Depreciation expense = $3500

The van's purchase price = $45,000

It's salvage value = $3,000

Subtract the salvage value from the purchase price to find the depreciable cost.

Depreciation value = 45,000 - 3000

                              = $42000

Divide the depreciable cost by the asset's lifespan to get the depreciation.

Depreciation         = Depreciation value / useful life

                              = 42000 / 6

                              = $7000 per year

from July 1 - dec 31 =6 months

                              = 7000/2 (12/6 = half year)

                              = $3500