A construction equipment costs P180,000. It has a salvage value of P15,000 at the end of its life of 12 years. Find the 5th year depreciation using a constant percentage method or Matheson Method.

Q: A machine has an initial cost of P91,123.71 and a salvage value of P14,839.26 after 7 years. What is…

A: Total Depreciation under Straight Line Depreciation = Annual Depreciation x No. of years Annual…

Q: An automated assembly robot that cost $400,000 has a depreciable life of five years with a $100,000…

A: The book value is the cost of the assets less the depreciation for the period. The depreciation is…

Q: A property is purchased at 1M and is expected to last 10 years with a salvage value of P100,000.…

A: Initial Cost = P 1,000,000 Salvage value = P100,000. Time Period = 10 Years

Q: An earth moving equipment has a first cost of P 25,000, estimated life of 6 years, with no salvage…

A: In Sinking fund method, the depreciation of the asset is calculated to accumulate the amount of…

Depreciation Methods

The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.

Depreciation Accounting

In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.