Question

1. Consider the purchase of a new farm truck (automobile). The specific information is:

Total Purchase cost = $150,000.00              Purchase date = Jan 1, 2020

Useful life = 6 years                                      Salvage value = $50,000.00

Note: each highlighted box is worth 1 point

Complete each depreciation table.

ECONOMIC DEPRECIATION:

1. Fill in the table using the straight-line depreciation method for economic depreciation. (5 points)

Year	Remaining value at beginning of year	Depreciation	Remaining value at end of year
2020
2021
2022
2023
2024
2025

Answer 1

Year	Remaining value at beginning of year	Depreciation	Remaining value at end of year
2020	$                     100,000	$       16,667	$                   83,333
2021	$                        83,333	$       16,667	$                   66,667
2022	$                        66,667	$       16,667	$                   50,000
2023	$                        50,000	$       16,667	$                   33,333
2024	$                        33,333	$       16,667	$                   16,667
2025	$                        16,667	$       16,667	$                            -

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