A telephone company purchased microwave radio equipment for P6,000,000. Freight and installation charges amounted to 4% of the purchased price. If the equipment shall be depreciated over a period of 10 years with a salvage value of 8%. Determine the depreciation cost during 5th year. Show the solution.

A telephone company purchased microwave radio equipment for P6,000,000. Freight and installation charges amounted to 4% of the purchased price. If the equipment shall be depreciated over a period of 10 years with a salvage value of 8%. Determine the depreciation cost during 5th year. Show the solution.

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

Problem 1PS

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A new engine was installed by a textile plant at a cost of P353,000 and projected to have a useful life of 14 years. At the end of the useful life, it is estimated to have a salvage value of 31,000. Determine the annual cost if interest is 17% compounded semi-annually.
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