Presented below is information related to Vaughn Manufacturing Corporation. Asset Cost Estimated Salvage Estimated Life (in years) $54,700 $6,500 10 33,200 5,300 36,800 4,400 9 18,200 1,400 23,900 2,900 6 (a) Compute the rate of depreciation per year to be applied to the plant assets under the composite method. (Round answer to 2 decimal place, eg. 4.83%.) Composite rate
Presented below is information related to Vaughn Manufacturing Corporation. Asset Cost Estimated Salvage Estimated Life (in years) $54,700 $6,500 10 33,200 5,300 36,800 4,400 9 18,200 1,400 23,900 2,900 6 (a) Compute the rate of depreciation per year to be applied to the plant assets under the composite method. (Round answer to 2 decimal place, eg. 4.83%.) Composite rate
Chapter8: Depreciation And Sale Of Business Property
Section: Chapter Questions
Problem 6MCQ: Which of the following is not true about the MACRS depreciation system: A salvage value must be...
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Concept explainers
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.
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![Presented below is information related to Vaughn Manufacturing Corporation.
Asset
Cost
Estimated Salvage
Estimated Life (in years)
A
$54,700
$6,500
10
B
33,200
5,300
9.
36,800
4,400
6.
18,200
1,400
23,900
2,900
6.
(a)
Compute the rate of depreciation per year to be applied to the plant assets under the composite method. (Round answer to 2
decimal place, e.g. 4.83%.)
Composite rate
List of Accounts](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F671de901-83b8-4f97-8655-0b1467b41a0f%2F53e91506-159f-41ba-9081-d84fa6511d8b%2Fjm7gob_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Presented below is information related to Vaughn Manufacturing Corporation.
Asset
Cost
Estimated Salvage
Estimated Life (in years)
A
$54,700
$6,500
10
B
33,200
5,300
9.
36,800
4,400
6.
18,200
1,400
23,900
2,900
6.
(a)
Compute the rate of depreciation per year to be applied to the plant assets under the composite method. (Round answer to 2
decimal place, e.g. 4.83%.)
Composite rate
List of Accounts
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