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P18,000. As a percentage of the initial cost, what is the straight-line depreciation rate of the equipment?

P18,000. As a percentage of the initial cost, what is the straight-line depreciation rate of the equipment?

Essentials Of Investments
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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Please answer items 5,6,7 and 8. Thank you.

5. Factory equipment has an initial cost of P175,000. Its salvage value after 8 years is P18,000. As a percentage of the initial cost, what is the straight-line depreciation rate of the equipment? 6. The annual depreciation of P25,000 has been reserve for a machine for a machine using straight line for 10 years. If the first cost is P300,000, determine the salvage value of the machine. 7. An equipment costs P15,000 with a salvage value of P800 at the end of 12 years. Calculate the annual depreciation by sinking fund method with 30% interest. 8. Water pipe has a first cost of P35,000 and has no salvage value after 20 years, using sinking fund depreciation, determine the annual depreciation for 20% interest.
Transcribed Image Text:5. Factory equipment has an initial cost of P175,000. Its salvage value after 8 years is P18,000. As a percentage of the initial cost, what is the straight-line depreciation rate of the equipment? 6. The annual depreciation of P25,000 has been reserve for a machine for a machine using straight line for 10 years. If the first cost is P300,000, determine the salvage value of the machine. 7. An equipment costs P15,000 with a salvage value of P800 at the end of 12 years. Calculate the annual depreciation by sinking fund method with 30% interest. 8. Water pipe has a first cost of P35,000 and has no salvage value after 20 years, using sinking fund depreciation, determine the annual depreciation for 20% interest.
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