The initial cost of a paint sand mill, including its installation is P800,000. The BIR approved life of this machine is 10 years for depreciation. The estimated salvage value of the mill is P50,000 and the cost of dismantling is estimated to be P15,000. Using the straight line depreciation, What is the annual depreciation charge and what is the book value of the machine at the end of six years: A. P56,897 : P245,900 B. P76,500 : P341,000 C. P65,456 : P456,221 D. P78,234 : P456,234

The initial cost of a paint sand mill, including its installation is P800,000. The BIR approved life of this machine is 10 years for depreciation. The estimated salvage value of the mill is P50,000 and the cost of dismantling is estimated to be P15,000. Using the straight line depreciation, What is the annual depreciation charge and what is the book value of the machine at the end of six years: A. P56,897 : P245,900 B. P76,500 : P341,000 C. P65,456 : P456,221 D. P78,234 : P456,234

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

100%

The initial cost of a paint sand mill, including its installation is P800,000. The BIR approved
life of this machine is 10 years for depreciation. The estimated salvage value of the mill is
P50,000 and the cost of dismantling is estimated to be P15,000. Using the straight line
depreciation, What is the annual depreciation charge and what is the book value of the
machine at the end of six years:
A. P56,897 : P245,900
B. P76,500 : P341,000
C. P65,456 : P456,221
D. P78,234 : P456,234

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