A depreciable asset costs $10,000 and has an estimated salvage value of $1600 at the end...

A depreciable asset costs $10,000 and has an estimated salvage value of $1600 at the end of its 6-year depreciable life. Compute the depreciation schedule for this asset by both SOYD depreciation and DDB depreciation.

Expert Solution

Answer:-

Book value Start = $10000

years of life = 6

salvage value = $1600

=> (A) Depreciation schedule as per SOYD depreciation method as prepared in Excel.

=> (B) Depreciation schedule as per DDB (Double declined method) as prepared in excel

Rahul Sunny answered 2 years ago

An asset costs $10,000 and has a depreciable life of 10 years and a salvage value...

An asset costs $10,000 and has a depreciable life of 10 years and a salvage value of $3,000. Determine the book (asset) value at the end of the 9th year using each of the following methods of depreciation (a) double-declining-balance method (b) textbook-declining-balance method (Matheson formula), and (c) sum-of-years’ digits method.

Lundy Company purchased a depreciable asset for $99,000 on January 1. The estimated salvage value is...

Lundy Company purchased a depreciable asset for $99,000 on January 1. The estimated salvage value is $18,000, and the estimated useful life is 9 years. The double-declining balance method will be used for depreciation. What is the depreciation expense for the second year on this asset? Please round the double-declining balance rate to 2 decimal places, e.g. 0.35 or 35% in your intermediate calculations. $11,000 $17,820 $13,900 $16,988

Swifty Corporation purchased a depreciable asset for $710000 on April 1, 2015. The estimated salvage value...

Swifty Corporation purchased a depreciable asset for $710000 on April 1, 2015. The estimated salvage value is $71000, and the estimated useful life is 5 years. The straight-line method is used for depreciation. What is the balance in accumulated depreciation on May 1, 2018 when the asset is sold? $299550 $352050 $394050 $257550

. A dump truck is purchased for $110,000 and has an estimated salvage value of $10,000...

. A dump truck is purchased for $110,000 and has an estimated salvage value of $10,000 at the end of the recovery period. Prepare a depreciation schedule for the dump truck with a recovery period of five years using: a) the straight-line method b) the sum-of-the-years method c) the declining-balance method

A depreciable item is purchased for $500,000. The salvage value at the end of 25 years...

A depreciable item is purchased for $500,000. The salvage value at the end of 25 years is estimated at $100,000. What is the depreciation in each of the first three years using the (a) straight line, (b) sum-of-the-years' digits, and (c) double-declining balance methods?

Consider an asset that costs $196,000 and is depreciated straight-line to 10,000 salvage value over its...

Consider an asset that costs $196,000 and is depreciated straight-line to 10,000 salvage value over its 12-year tax life. The asset is to be used in 8-year project; at the end of the project, the asset can be sold for $47,000. The relevant tax rate is 35 percent. What is the after-tax cash flow from the sale of this asset?

Consider the depreciation of a %5,000 asset with $0 salvage value. Assuming a 5 year depreciable...

Consider the depreciation of a %5,000 asset with $0 salvage value. Assuming a 5 year depreciable life, develop the complete depreciation schedules for the asset showing year-by-year depreciation charges and book values, using: (a) Straight Line (b) Sum-of-years'-digits (SOYD) (c) Declining Balance (DB) with 20% depreciation rate, and (d) Modified accelerated cost recovery system (MACRS) depreciation. Be sure to include complete depreciation schedules showing year-by-year depreciation amounts, and, book values, for each problem.

An asset in the five-years MACRS property class costs $150,000 and has a zero estimated salvage...

An asset in the five-years MACRS property class costs $150,000 and has a zero estimated salvage value after six years of use. The asset will generate annual revenues of $320,000 and will require $80,000 in annual labor costs and $50,000 in annual material expenses. Assume a tax rate of 21%. Compute the after-tax cash flows over the project life and the NPW for a MARR = 12%. Is the investment acceptable?

A machine costs Rs. 10,000 with useful life of 5 years. It has a salvage value...

A machine costs Rs. 10,000 with useful life of 5 years. It has a salvage value of Rs. 2,000 at the end of its useful life. The machine is expected to generate the following cash flows; Year Cash Flow (PKR) 1 5,000 2 6,000 3 8,000 4 6,500 5 4,000 Calculate Accounting Rate of Return? Tax is applied at 30% per annum. Why Accounting Rate of Return is not among the favorite methodology to evaluate a project? In what circumstances...

A new machine costs $42,000 and has a $2000 salvage value at the end of its...

A new machine costs $42,000 and has a $2000 salvage value at the end of its 8-year useful life. Determine the straight-line (SL), and the double declining balance (DDB) depreciation schedules for the machine.

Question