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Makovka662 [10]

2 years ago

13

Use straight line (SL) depreciation to determine a. annual depreciation charge (5 points) and b. annual book values for the life

of the asset having the price of $1,900,000, depreciable life of 10 years, and the salvage value of $600,000. (10 points)

1 answer:

LenaWriter [7]2 years ago

7 0

Answer:

(a) $130,000

Explanation:

Given that,

Previous year book value = $1,900,000

Depreciable life = 10 years

Salvage value = $600,000

(a) Annual depreciation charge:

= (Book value - Salvage value) ÷ Depreciable life

= (1,900,000 - 600,000) ÷ 10

= $130,000

(b) Annual book value:

= Previous year book value - Current year depreciation amount

For year 0,

Annual book value = $1,900,000

For year 1,

Annual book value:

= Previous year book value - Current year depreciation amount

= $1,900,000 - $130,000

= $1,770,000

For year 2,

Annual book value:

= Previous year book value - Current year depreciation amount

= $1,770,000 - $130,000

= $1,640,000

For year 3,

Annual book value:

= Previous year book value - Current year depreciation amount

= $1,640,000 - $130,000

= $1,510,000

For year 4,

Annual book value:

= Previous year book value - Current year depreciation amount

= $1,510,000 - $130,000

= $1,380,000

For year 5,

Annual book value:

= Previous year book value - Current year depreciation amount

= $1,380,000 - $130,000

= $1,250,000

For year 6,

Annual book value:

= Previous year book value - Current year depreciation amount

= $1,250,000 - $130,000

= $1,120,000

For year 7,

Annual book value:

= Previous year book value - Current year depreciation amount

= $1,120,000 - $130,000

= $990,000

For year 8,

Annual book value:

= Previous year book value - Current year depreciation amount

= $990,000 - $130,000

= $860,000

For year 9,

Annual book value:

= Previous year book value - Current year depreciation amount

= $860,000 - $130,000

= $730,000

For year 10,

Annual book value:

= Previous year book value - Current year depreciation amount

= $730,000 - $130,000

= $600,000

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Troy Ounces USD Value

14.00 $24,984

14.01 $25,001

14.02 $25,019

14.03 $25,037

14.04 $25,055

14.05 $25,073

14.06 $25,091

14.07 $25,108

14.08 $25,126

14.09 $25,144

14.10 $25,162

14.11 $25,180

14.12 $25,198

14.13 $25,216

14.14 $25,233

14.15 $25,251

14.16 $25,269

14.17 $25,287

14.18 $25,305

14.19 $25,323

14.20 $25,340

14.21 $25,358

14.22 $25,376

14.23 $25,394

14.24 $25,412

Troy Ounces USD Value

14.25 $25,430

14.26 $25,448

14.27 $25,465

14.28 $25,483

14.29 $25,501

14.30 $25,519

14.31 $25,537

14.32 $25,555

14.33 $25,572

14.34 $25,590

14.35 $25,608

14.36 $25,626

14.37 $25,644

14.38 $25,662

14.39 $25,680

14.40 $25,697

14.41 $25,715

14.42 $25,733

14.43 $25,751

14.44 $25,769

14.45 $25,787

14.46 $25,804

14.47 $25,822

14.48 $25,840

14.49 $25,858

Troy Ounces USD Value

14.50 $25,876

14.51 $25,894

14.52 $25,912

14.53 $25,929

14.54 $25,947

14.55 $25,965

14.56 $25,983

14.57 $26,001

14.58 $26,019

14.59 $26,036

14.60 $26,054

14.61 $26,072

14.62 $26,090

14.63 $26,108

14.64 $26,126

14.65 $26,144

14.66 $26,161

14.67 $26,179

14.68 $26,197

14.69 $26,215

14.70 $26,233

14.71 $26,251

14.72 $26,268

14.73 $26,286

14.74 $26,304

Troy Ounces USD Value

14.75 $26,322

14.76 $26,340

14.77 $26,358

14.78 $26,376

14.79 $26,393

14.80 $26,411

14.81 $26,429

14.82 $26,447

14.83 $26,465

14.84 $26,483

14.85 $26,500

14.86 $26,518

14.87 $26,536

14.88 $26,554

14.89 $26,572

14.90 $26,590

14.91 $26,607

14.92 $26,625

14.93 $26,643

14.94 $26,661

14.95 $26,679

14.96 $26,697

14.97 $26,715

14.98 $26,732

14.99 $26,750

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2 years ago