An industrial plant bought a generator set for P90,000. Other expenses including installation amounted to P10,000. The generator set is to have life of 17 years with a salvage value at the end of life of P5,000. Determine the depreciation during the 13tl year and the book value at the end of 13 years by the (a`lininc. (L) D ' 'd) SYD method.
An industrial plant bought a generator set for P90,000. Other expenses including installation amounted to P10,000. The generator set is to have life of 17 years with a salvage value at the end of life of P5,000. Determine the depreciation during the 13tl year and the book value at the end of 13 years by the (a`lininc. (L) D ' 'd) SYD method.
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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Could you please answer this on manual using formulas not on excel. thank you.
Transcribed Image Text:Question
An industrial plant bought a generator
set for P90,000. Other expenses including
installation amounted to P10,000. The
generator set is to have life of 17 years with
a salvage value at the end of life of P5,000.
Determine the depreciation during the 13th
year and the book value at the end of 13
years by the (;` olininmh
' (d) SYD method.
Expert Answer O
Step1
а)
Disclaimer:
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multiple sub-parts, we will solve first three
sub-parts for you. To get remaining sub-
Transcribed Image Text:1:35 J
Step1
a)
cost of Generator = 90,000
Installation Cost = 10,000
Therefore Book Value at starting = 90,000 +
10,000 = 1,00,000
Salvage Value = 5,000
Step2
b)
Sum of useful years :
1+2+3+4+5+6+7+8+9+10+11+12+13+14+15+16
= 153
D
Book Value
Total cost
Depreciation
Depreciation
accumulated
Book Value
1 Year
Year Star
Depreciable
rate
expenses
Depreciation
year-end
2
1
1,00,000
95.000
0.111111111
10555.55556
10555.55556
89.444
3
2
89,444
95,000
0.104575163
9934.640523
20490.19608
79,510
0.098039216
29803.92157
4
3
79,510
95,000
9313.72549
70,196
4
70,196
95,000
0.091503268
8692.810458
38496.73203
61,503
61.503
95,000
0.08496732
8071.895425
46568.62745
53.431
53,431
95,000
0.078431373
7450.980392
54019.60784
45,980
0.071895425
6830.065359
8
45.980
95,000
60849.6732
39,150
9
39,150
95,000
0.065359477
6209.150327
67058.82353
32,941
10
32,941
95,000
0.058823529
5588.235294
72647.05882
27,353
4967.320261
4346.405229
3725.490196
11
10
27,353
95.000
0.052287582
77614.37908
22,386
12
11
22,386
95,000
0.045751634
81960.78431
18,039
13
12
18,039
95,000
0.039215686
85686.27451
14,314
14
13
14,314
95.000
0.032679739
3104.575163
88790.84967
11.209
15
14
11,209
95,000
0.026143791
2483.660131
91274.5098
8,725
16
15
8,725
95,000
0.019607843
1862.745098
93137.2549
6,863
17
16
6,863
95,000
0.013071895
1241.830065
94379.08497
5,621
18
17
5.621
95,000
0.006535948
620.9150327
95000
5,000
10
Deeiti
edeton
Bok e er
Tatal con Del
Bepredeonrn
Book Wl yend
?
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