Net book value of equipment after two years' depreciation Steps:

• Depreciable amount = $20,000 cost -$10,000 residual = $10,000
• Annual depreciation = $10,000 ÷ 5 years =$2,000
• Accumulated depreciation for 2023–2024 = $2,000 × 2 years =$4,000
• Net book value = $20,000 -$4,000 = $16,000

Why C is correct:

• Straight-line method formula for carrying amount is cost minus (depreciable base ÷ useful life × years used), yielding $16,000 as the equipment's balance net of provision.

Why the others are wrong:

• A: Accumulated depreciation ignoring residual ($20,000 ÷ 5 × 2 =$8,000), understating net value.
• B: Equals residual value, ignoring two years' depreciation.
• D: Original cost, before applying any depreciation.

Final answer: C