Answer:
Book value = $45,703,520
Explanation:
We can calculate the book value of purchase after its third year of use by deducting all three years of depreciation from the cost of the asset.
DATA
Purchase cost = $55,736,000
Useful life = 15 years
Salvage value = $5,573,600
Solution
Book value = Cost - Accumulated depreciation
Book value = $55,736,000 - $10,032,480(w)
Book value = $45,703,520
Working
Depreciation per year = ![\frac{Cost-salvagevalue}{life}](https://tex.z-dn.net/?f=%5Cfrac%7BCost-salvagevalue%7D%7Blife%7D)
Depreciation per year = ![\frac{55,736,000-5,573,600}{15}](https://tex.z-dn.net/?f=%5Cfrac%7B55%2C736%2C000-5%2C573%2C600%7D%7B15%7D)
Depreciation per year = $3,344,160
Depreciation for 3 years = $3,344,160 x 3
Depreciation for 3 years = $10,032,480
Three years accumulated depreciation for three years would be $10,032,480