A machine bought for #35,000 was estimated to have a life span of 5 years with a scrap value of #9,000The yearly depreciation using the straight line method...
Question 1 Report
A machine bought for #35,000 was estimated to have a life span of 5 years with a scrap value of #9,000The yearly depreciation using the straight line method would be
Answer Details
To calculate the yearly depreciation using the straight-line method, you need to subtract the scrap value from the cost of the machine and then divide the result by the machine's estimated lifespan.
In this case, the cost of the machine is #35,000, and the scrap value is #9,000. Therefore, the depreciable cost of the machine is #35,000 - #9,000 = #26,000.
The machine's estimated lifespan is 5 years, so you divide the depreciable cost of the machine by 5 to get the yearly depreciation.
#26,000 ÷ 5 = #5,200
Therefore, the yearly depreciation using the straight-line method would be #5,200.
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