St. Francis Cooperative purchased a P45 000.00 — pump for its irrigation project. Setup and installation cost amounted to P5000.00. Using the SYD method, economic life and salvage value was initially estimated to be 12 years and P3800.00, respectively. Due to poor maintenance and continuous exposure to the elements, a re-evaluation after five years indicated that the remaining economic life is only four years, with a salvage value of P2500.00. Find the book value of the pump for the seventh year
St. Francis Cooperative purchased a P45 000.00 — pump for its irrigation project. Setup and installation cost amounted to P5000.00. Using the SYD method, economic life and salvage value was initially estimated to be 12 years and P3800.00, respectively. Due to poor maintenance and continuous exposure to the elements, a re-evaluation after five years indicated that the remaining economic life is only four years, with a salvage value of P2500.00. Find the book value of the pump for the seventh year
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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St. Francis Cooperative purchased a P45 000.00 — pump for its irrigation project. Setup and installation cost amounted to P5000.00. Using the SYD method, economic life and salvage value was initially estimated to be 12 years and P3800.00, respectively. Due to poor maintenance and continuous exposure to the elements, a re-evaluation after five years indicated that the remaining economic life is only four years, with a salvage value of P2500.00. Find the book value of the pump for the seventh year. (Ans. P7865.40)
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