Spreadsheet exercise A bowling alley costs P500,000 and has a useful life of 10 years. Its estimated MV at the end of year 10 is P20,000. TheMARR is 10% per year. Create a spreadsheet that calculates the depreciation for years 1–10 using: (i) the SL method (ii) the 200% DB method
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.
. Spreadsheet exercise
A bowling alley costs P500,000 and has a useful life of 10 years. Its estimated MV at the end of year 10 is P20,000. TheMARR is 10% per year.
Create a spreadsheet that calculates the
(i) the SL method
(ii) the 200% DB method
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 4 images
