Josh spent 250,000.00 pesos to buy a set of entertainment system that he will use in his marketing strategy for his new business. The entertainment system set has a depreciation rate of 26% that can be used for eight years. A. How much is the salvage value of the entertainment system set using declining balance method? B. How much is the depreciation for 4th year?
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.
Josh spent 250,000.00 pesos to buy a set of entertainment system that he will use in his marketing strategy for his new business. The entertainment system set has a
A. How much is the salvage value of the entertainment system set using declining balance method?
B. How much is the depreciation for 4th year?
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