Original question written by FE Exam AI Prep from the public FE Civil exam specification. Before release, a solver model re-derived the answer twice from the question alone, without its answer key, and a critic model checked the result, and the arithmetic was re-run as an executable calculation. No licensed engineer reviews these questions. It is not an NCEES question and does not come from any NCEES practice exam. FE Exam AI Prep is an independent study tool and is not affiliated with, endorsed by, or sponsored by NCEES.
Straight-Line Depreciation and Book Value: FE Civil practice problem 1
For the Oak Point water storage yard, a civil analyst preparing an operations handoff review uses straight-line depreciation for an asset with first cost $78000, salvage value $5000, and life of 6 years. What annual depreciation is used?
- A7739 $/yr
- B13837 $/yr
- C12167 $/yr
- D15882 $/yr
Show the answer and worked solution
Answer: C — 12167 $/yr
Worked solution
- Step 1. Use straight-line depreciation
D = (first cost - salvage)/life
- Step 2. Substitute values
D = (78000 - 5000)/6 = 12166.67 $/yr
Why the other choices are wrong
- Choice A
- This total sits roughly 36% under the true result, and no single unit slip, sign flip, or misapplied factor in the straight-line depreciation formula reproduces it cleanly; the reliable path computes D = (78000 - 5000)/6 = 12166.67 $/yr.
- Choice B
- This total exceeds the correct value by close to 45% without matching any single defensible error in the straight-line depreciation formula; working the numbers directly gives D = (78000 - 5000)/6 = 12166.67 $/yr.
- Choice D
- This number sits close to 18% over the true answer and cannot be pinned to a single well-defined arithmetic slip in the straight-line depreciation formula; applying the numbers exactly as given yields D = (78000 - 5000)/6 = 12166.67 $/yr.