Is known :
Cost of fixed assets = $ 60.000
Residual value = & 5.000
The economic life of fixed assets = 4 years
Asked:
Depreciation fees for the 4th year?
Settlement:
Depreciation = acquisition cost of fixed assets - residual value: economic life of fixed assets
Depreciation = 4 x (($ 60.000 - $ 5.000): 4)
Depreciation = $ 55.000
So the depreciation expense for the 4th year is $ 55.000
Note: Value 4 comes from the value in question, namely depreciation in the 4th year.
<h2>Further explanation
</h2>
Depreciation is the value of a fixed asset that can be depreciated over the life of the asset utilized. Depreciation is a form of price adjustment of an asset continuously by a decrease in the capacity of an asset, both impairment, quality, and quantity.
In other words, the depreciation method is the allocation of the acquisition cost or the majority of the acquisition cost of a fixed asset over the useful life of the asset. The amount that can be depreciated is the difference between the acquisition price and the residual value, which is the value of the asset at the end of its useful life. Each company plays an important role in determining what method to use and this will affect the amount of depreciation expense.
Depreciation is influenced by 3 factors: acquisition cost, salvage value, an economic lifetime. Furthermore, there are three types of depreciation methods that can be used to determine the value of assets that we have, as follows:
1. Straight Line Method
The straight-line method is used to name the asset usage expense in each period.
Calculation of the straight-line method can use the following formula:
<em>Depreciation = (Cost - Estimated Residual Value) / (Period of use)
</em>
2. Double Declining Balance Method
The double-declining balance method is a way to calculate depreciation based on a percentage of the value in the initial book of product purchases for a certain period. The percentage of the depreciation in the balance has decreased by double 2 times the depreciation rate of the straight-line method.
3. Unit of Production Method
According to the Production, Unit method is depreciation based on the number of product units produced in a certain period. The depreciation expense of a production unit is calculated based on the units of production units. So that the depreciation of each period will correspond to fluctuations in production results.
Learn more
Depreciation method brainly.com/question/13441389, brainly.com/question/4569094
Details
Class: College
Subject: Business
Keyword: The formula for the straight-line depreciation method.
