Question

A wood products company has decided to purchase new logging equipment for ​$ with a​ trade-in of its old equipment. The old equipment has a BV of ​$ at the time of the​ trade-in. The new equipment will be kept for years before being sold. Its estimated SV at the time is expected to be ​$_____________. Using the MACRS​ (GDS recovery​ period), what is the depreciation charge permissible at year ?

Answer 1

Answer:

The question is incomplete, so I looked for a similar one:

A wood products company has decided to purchase new logging equipment for $100,000 with a trade-in of its old equipment. The old equipment has a BV of $10,000 at the time of the trade-in. The new equipment will be kept for 10 years before being sold. Using the MACRS​ (GDS recovery​ period), what is the depreciation charge permissible at year 1?

Depreciable value using MACRS is $100,000 and logging equipment is classified as 7 year class, and I will use the half-year convention:

depreciation year 1 = $100,000 x 14.29% = $14,290