Assignment Depreciation
Assignment Depreciation
Assignment Depreciation
Assignment # 02
QUESTION NO: 1
ABC is considering the purchase of a second-hand scanning microscope at a cost of $10,500,
with an estimated salvage value of $500 and a projected useful life of four years. Determine the
straight-line (SL).
SOLUTION:
COST OF MICROSCOPE = $10,500
SALVAGE VALUE = $500
USEFUL LIFE = 4 YEARS
FORMULA:
COST – SALVAGE ÷ USEFUL LIFE
$10,500 – $500 ÷ 4 = $2500
SOLUTION:
COST OF MACHINE = $12,000
SALVAGE VALUE = 1200
RATE = 20%
DEPRECIATION = 10,800
QUESTION NO: 3
A pump cost $1,000 and has a salvage value of $100 after a life of five years. Using the
declining balance depreciation method, determine the 10% depreciation rate.
SOLUTION: