Question

Building is 350,000, Equipment is 262,500, Truck, 87,500 and cash is 700,000

The equipment has a salvage value of $10,000, life
expectancy of 5 years. Calculate depeciation for
all years necessary using the double declining balace.
What is the book value at the beginning of year 6?
	Depreciation		Book-Value
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
It is planned that the delivery truck will be driven
200,000miles during its life time of 5 years. Mileage
is as follows:
Year 1: 65,000 miles, Year 2: 79,500 miles, Year 3: 45,325
Year 4: 9,690 miles, Year 5: 8,650 miles.
Calculate depreciation and book value.
	Depreciation		Book-Value
Year 1
Year 2
Year 3
Year 4
Year 5

Answer 1

Solil Equipment Cost = 262soo Salvage Value =__10000 Useful life = 5 years Depriciation Rate = 2x__I Useful life -*loo _ : 2x 1 _x100 = 40% Depriciation for all years are Year Begining Book Value Depriciation | 262500 10 5000 157.500 _63000 44500 37800 56700 22680_ 34020 240201 as follows Euding Book Value 157500 q4500 56700 34020 10000 & The year 5 double declining balance depriciation is 24020 which is the I difference of Book Value at the begining of the year 5 and Salvage Value (3402 - 10000)

The Book value at the begining of year a 6 are as follow 262500 Equipment Cost Less - Tótal Depriciation for all 5 years 252500 Book Value at the begining | Чесах 10000 Cost of Truck Estimated Ugage - B750o 200000 miles Year Begining Book Value usage (miles) Depriciation Ending Book Value 87500 65000 28437.5 5906205 12 59062.50 49500 34781.25 24261-25 3 24281.25 45325 19829.69_4451.56 y 4451.56 9690 4239.380 212.18 15 212.18 8650 212.18 0.00

Depriciation for Truck Calculated as Per usage - based Depriciation method or Calculation are as follows: year I to year u Cost of Truck Particular year's -x miles Total Estimated driven 1 miles for Example : year 1 Depriciation = 87.500 65000 200000* = 28437.5 I for year 5 Webriciation Book Value at the begining year 5 Less Salvage Value id of Assumed