Question

In: Economics

a brand new machine is estimated to have a salvage value of P10000 after 10 years...

a brand new machine is estimated to have a salvage value of P10000 after 10 years and book value of P30,000 after 5 years, what is the initial cost of the machine? (assume straight line depreciation)

Solutions

Expert Solution

According to Straghtline method, depreciation every year remains the same, hence depreciation annually is calculated using the information given and then the standard formula to calculate the cost of machine is used.


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