Engr. Dela Cruz bought a gantry machine for erecting tall structures. It was invoiced from Japan including its cost, insurance and freight at 450,000. Brokerage, bank, other fees and duties, and permits amount to 150,000. At the end of 10 years, he expects to sell it at 50,000. The working hours of the gantry machine is 130,000. At 16% interest rate, compare the book value at the end of 6 years by computing for it using the following methods: A.) Straight Line Method B.) Sinking Fund Method C.) Declining Balance Method
Engr. Dela Cruz bought a gantry machine for erecting tall structures. It was invoiced from Japan including its cost, insurance and freight at 450,000. Brokerage, bank, other fees and duties, and permits amount to 150,000. At the end of 10 years, he expects to sell it at 50,000. The working hours of the gantry machine is 130,000. At 16% interest rate, compare the book value at the end of 6 years by computing for it using the following methods: A.) Straight Line Method B.) Sinking Fund Method C.) Declining Balance Method
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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5. Engr. Dela Cruz bought a gantry machine for erecting tall structures. It was invoiced from Japan
including its cost, insurance and freight at 450,000. Brokerage, bank, other fees and duties, and permits
amount to 150,000. At the end of 10 years, he expects to sell it at 50,000. The working hours of the
gantry machine is 130,000. At 16% interest rate, compare the book value at the end of 6 years by
computing for it using the following methods:
A.)
B.) Sinking Fund Method
C.) Declining Balance Method
D.) Double Declining Balance Method
E.) Sum-of-the-Years’ Digits Method
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