When inventories go down in value, accountants adjust the value of the inventory that is recorded on the balance sheet. Sometime
1 answer:
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We will examine the annual growth rate of the following question.
Formula for calculating the annual growth rate is Growth Percentage Over One year =[ (F÷S) ¹/y - 1] ₓ 100
where F= final value
S= start value
y= Number of years.
(1,350000÷150) y= 2010-1895=115
∴ [(1,350,000÷150) ¹/₁₁₅ - 1] × 100
= (9000¹/₁₁₅ - 1) ₓ 100
= (1.082393 - 1) ₓ 100
= 8.24%
Over the course of 115 years the winners prize money grew from $150.00 to $1,350,000.00, its annual growth rate = 8.24%
Please Note, raising a value a to the ¹/<em>b</em> exponent is equivalent to taking the <em>b</em>th root of a. You will likely need a calculator with an " <em>" </em>button, or a good online calculator.
Couldn't find the basic symbols, had to improvise.
Answer:
Cost, residual value, and service life
Explanation:
The computation of depreciation requires three (3) inputs.
Cost: the acquisition cost of the asset
Residual value: the value at which the asset will be sold
Service life: the number of years the assets will be used by a company (also known as useful life).
Thus
Physical life will be inappropriate because the physical life includes not only the useful life of the asset in a company, but also the life of the asset when it is sold.
The fair value of an comes into play when the asset is revalued, usually for a sale. Replacement value is similar to fair value as it is the market value of the asset at a given point in time.