Explanation Given information: The cost of robot is $ 25 , 000 , scrap value is $ 2 , 500 an estimate life of eight year. Formula used: Depreciable value = Total cost − Salvage value Yearly depreciation = Total cost × double declining rate First end of year book value = Total cost − first year depreciation Yearly straight-line rate = 1 number of years of expected life yearly double-declining rate = straight-line rate × 2 Calculation: Consider the above information, Double-declining rate = straight-line rate × 2 = 1 number of years of expected life × 2 = 1 5 × 2 = 2 5 = 0.25 The depreciation value of year1 is given by Year 1 Depreciation = $ 25 , 000 × ( 0.25 ) = $ 6 , 250 The cost after 1 year is given by, End of year 1 book value = Total cost − depreciation = $25,000 − $6,250 = $18,750 The depreciation value of year2 is given by Year 2 Depreciation = previous end of year book value × ( 0.25 ) = $ 18 , 750 × ( 0.25 ) = $4,687 .5 The cost after 2 year is given by, End of year 2 book value = previous end of year book value − depreciation = $18,750 − $4,687 .5 = $14,062 .5 The depreciation value of year3 is given by Year 3 Depreciation = previous end of year book value × ( 0.25 ) = $ 14 , 062.5 × ( 0.25 ) = $3,515 .625 The cost after 3 year is given by, End of year 3 book value = previous end of year book value − depreciation = $14,062 .5 − $3,515 .625 = $10,546 .875 The depreciation value of year4 is given by Year 4 Depreciation = previous end of year book value × ( 0.25 ) = $ 10 , 546.875 × ( 0.25 ) = $2,636 .718 The cost after 4 year is given by, End of year 4 book value = previous end of year book value − depreciation = $10,546

11th Edition

ISBN: 9780134496436

Author: Cheryl Cleaves, Margie Hobbs, Jeffrey Noble

Publisher: PEARSON

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Chapter 17.1, Problem 4-4SC

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To calculate: The depreciation for a robot each of the eight year if the cost of robot is $25,000, scrap value is $2,500.

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Chapter 17.1, Problem 4-3SC

Chapter 17.1, Problem 1SE

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Chapter 17 Solutions

Business Math (11th Edition)

Ch. 17.1 - Prob. 1-1SC Ch. 17.1 - Prob. 1-2SC Ch. 17.1 - Prob. 1-3SC Ch. 17.1 - Prob. 1-4SC Ch. 17.1 - Prob. 1-5SC Ch. 17.1 - Prob. 2-1SC Ch. 17.1 - Prob. 2-2SC Ch. 17.1 - Prob. 2-3SC Ch. 17.1 - Prob. 2-4SC Ch. 17.1 - Prob. 3-1SC

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The depreciation for a robot each of the eight year if the cost of robot is $ 25 , 000 , scrap value is $ 2 , 500 .

Solution Summary: The author explains how to calculate the depreciation schedule of a robot of eight years.

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To calculate: The depreciation for a robot each of the eight year if the cost of robot is $25,000, scrap value is $2,500.

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Chapter 17 Solutions