Answered: What is the market value of a company…

What is the market value of a company vehicle that cost $54 has a salvage of $6,000 and an expected life of six years; after three years, when the company sells the vehicle?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

What is the market value of a company vehicle that cost $54,000, has a salvage value
of $6,000 and an expected life of six years; after three years, when the company sells
the vehicle?
O $18,000
$28,000
$36,000
O $40,000
O $42,000
cannot tell from this information provided

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Step 1: 1. Calculate the once a year depreciation:

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Step 2: 2. Depreciate the price through the range of years the car has been used:

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Section 179 Deduction and Modified Accelerated Cost Recovery System (MACRS) Depreciation

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