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“Indimex” is a Mexicam company that was intending to expand their fashion business, so they acquired...

“Indimex” is a Mexicam company that was intending to expand their fashion business, so they acquired new factory for USD 20 million, that would allow them to expand their business abroad. Its useful life is 20 years, and its expected residual value is USD 8 million.

Prepare a tabular comparison of the annual depreciation and book value for each of the first 3 years of service life under straight line and the double-declining-balance (DDB) depreciation method. Show all amounts in thousands of euros (rounded to the nearest thousand).

Solutions

Expert Solution

Note :-1. Double declining balance method is double of the straight line method.

2. year of starting of business is not known so depreciation is charged for whole year.

ekkarill92 answered 2 years ago
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