A construction machine was purchased at a price of $10,000 with a recovery value of $2000 after a useful life of 12 years. The machine was sold at the end of the fifth year, and the amount was saved in the bank. What is the value of the withdrawn amount after 10 years , if the interest of the bank is 15%. It was completed Calculation of depreciation by the method of offsetting depreciation.
A construction machine was purchased at a price of $10,000 with a recovery value of $2000 after a useful life of 12 years. The machine was sold at the end of the fifth year, and the amount was saved in the bank. What is the value of the withdrawn amount after 10 years , if the interest of the bank is 15%. It was completed Calculation of depreciation by the method of offsetting depreciation.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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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.
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Q4: A construction machine was purchased at a price of $10,000 with a recovery value of $2000 after a useful life of 12 years. The machine was sold at the end of the fifth year, and the amount was saved in the bank.
What is the value of the withdrawn amount after 10 years , if the interest of the bank is 15%. It was completed Calculation of depreciation by the method of offsetting depreciation.
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