estimated at 15 years and salvage value is 5%. At present, abandoning the old plant in favor of diesel plant is being considered. A market has been found for the old engine and boiler equipme P15,000. The remainder of the old plant can be utilized in the new and is given a valuation of Pt Depreciation has been figured on straight line basis. What is the difference between the deprecia

ENGR.ECONOMIC ANALYSIS
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ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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5. Ten years ago, a small steam plat of 2000 kw capacity costing P125 per kw was erected. The life was
estimated at 15 years and salvage value is 5%. At present, abandoning the old plant in favor of a new
diesel plant is being considered. A market has been found for the old engine and boiler equipment at
P15,000. The remainder of the old plant can be utilized in the new and is given a valuation of P8,500.
Depreciation has been figured on straight line basis. What is the difference between the depreciation
book value of the old plant and its sale value?
Transcribed Image Text:5. Ten years ago, a small steam plat of 2000 kw capacity costing P125 per kw was erected. The life was estimated at 15 years and salvage value is 5%. At present, abandoning the old plant in favor of a new diesel plant is being considered. A market has been found for the old engine and boiler equipment at P15,000. The remainder of the old plant can be utilized in the new and is given a valuation of P8,500. Depreciation has been figured on straight line basis. What is the difference between the depreciation book value of the old plant and its sale value?
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