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Andre45 [30]
3 years ago
11

A machine that cost $225,000 has an estimated residual value of $15,000 and an estimated useful life of 15,000 machine hours. Th

e company uses units-of-production depreciation and ran the machine 3,000 hours in year 1, 4,000 hours in year 2, and 5,000 hours in year 3. Calculate its book value at the end of year 3
Business
1 answer:
algol [13]3 years ago
8 0

Answer:

$57,000

Explanation:

<u><em>Step 1 : Depreciation Rate</em></u>

Depreciation Rate = (Cost - Residual Value) ÷ Estimated Production

therefore,

Depreciation Rate = $14.00 per machine hour

<u><em>Step 2 : Depreciation expenses</em></u>

Depreciation expense = Depreciation Rate x Annual production

therefore

Year 1 = $42,000

Year 2 = $56,000

Year 3 = $70,000

Total    = $168,000

<em><u>Step 3 : Book Value</u></em>

Book Value = Cost - Accumulated Depreciation

                    = $225,000 - $168,000

                    = $57,000

Conclusion :

book value at the end of year 3 is $57,000

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Amanda wants to buy a new car. What questions of financial responsibility should she ask herself before she makes the purchase?
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Explanation:

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3 years ago
Exotech has an inventory turn ratio of 60 with $50 million in annual sales, and an average inventory of $250,000. What is Exotec
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Answer:

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Explanation:

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