A tractor with an expected life of 10 years was bought for Le 15.om at the end of which it was to be sold for Le 1.0m. Its calculated depreciation is
Question 1 Report
A tractor with an expected life of 10 years was bought for Le 15.om at the end of which it was to be sold for Le 1.0m. Its calculated depreciation is
Answer Details
To calculate the depreciation of the tractor, we need to determine its annual depreciation.
The tractor was bought for Le 15.0m and will be sold for Le 1.0m at the end of 10 years, so its total depreciation is Le 15.0m - Le 1.0m = Le 14.0m.
To determine the annual depreciation, we divide the total depreciation by the number of years of its useful life:
Annual depreciation = Total depreciation / Useful life
Annual depreciation = Le 14.0m / 10 years = Le 1.4m per year
Therefore, the calculated depreciation of the tractor is Le 1.4m.
Answer: Le 1.4m
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