What is the book value of an asset purchased for $100,000 with a salvage value of $10,000 after 6 years of straight-line depreciation over 10 years?

To determine the book value of the asset after 6 years using straight-line depreciation, we first need to calculate the annual depreciation expense. The formula for straight-line depreciation is:

[ \text{Annual Depreciation} = \frac{(\text{Cost of Asset} - \text{Salvage Value})}{\text{Useful Life}} ]

In this case, the cost of the asset is $100,000, and the salvage value is $10,000, over a useful life of 10 years. Plugging in these numbers:

[ \text{Annual Depreciation} = \frac{(100,000 - 10,000)}{10} = \frac{90,000}{10} = 9,000 ]

Next, we multiply the annual depreciation by the number of years the asset has been used, which is 6 years:

[ \text{Total Depreciation after 6 Years} = 9,000 \times 6 = 54,000 ]

Now, we can find the book value after 6 years by subtracting the total depreciation from the original cost of the asset:

[ \text{Book Value} = \text{Cost of Asset}