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    Rustylovesmath's Avatar
    Rustylovesmath Posts: 4, Reputation: 1
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    #1

    Apr 25, 2007, 04:49 PM
    College Business Mathematics-Depreciation
    Depreciating Computer Equipment- The new computer equipment at Cruz Landscaping has a cost of $14,500, and estimated life of 8 years, and scrap value of $2100. Find (a) the annual depreciation and (b) the book value at the end of four years using the straight -line method of depreciation.

    Please help, I am stuck!
    jwkessel's Avatar
    jwkessel Posts: 3, Reputation: 1
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    #2

    Apr 27, 2007, 11:36 AM
    Assuming Straight Line Depreciation:

    Cost = $14,500
    Salvage = $2,100

    Depreciable Amount (Cost - Salvage) = 12,400

    (a) Annual Depreciation = Depreciable Amount / Est. Life
    12,400 / 8 = 1,550

    (b) Net Book Value = Original Cost - Accumulated Depreciation
    14,500 - (1,550 * 4) = 14,500 - 6,200 = 8,300
    Rustylovesmath's Avatar
    Rustylovesmath Posts: 4, Reputation: 1
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    #3

    Apr 28, 2007, 05:41 AM
    Quote Originally Posted by Rustylovesmath
    Depreciating Computer Equipment- The new computer equipment at Cruz Landscaping has a cost of $14,500, and estimated life of 8 years, and scrap value of $2100. Find (a) the annual depreciation and (b) the book value at the end of four years using the straight -line method of depreciation.

    Please help, I am stuck!
    Thank you for your help I really appreciate it and understand it so much better now. You are the best!! :-)

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