A) $349 B) $290 C) $1295 D) $500 Please explain the answer ullelassets that wear

Question

A) $349 B) $290 C) $1295 D) $500 Please explain the answer ullelassets that wear out or become obsolete are said to de referred to as depreciable assets. Depreciation is considered a business expense and is included in profit and loss statements.In Australia it is used predominantly in relation to taxation. The Prime Cost Method (Straight Line) Method In straight line method of depreciation, a fixed depreciation amount is deducted every year for the duration of asset's economic life. .The depreciation amount is the same every period. It is assumed that the asset depreciates evenly through its life. Annual depreciation formula Annual depreciation -Original Cost-Salvage Value Useful Life ( in years) Annual rate of depreciation formula × 100 Annual rate of depreciation : Annual depreciation Original Cost

Explanation / Answer

Annual depriciation is calculated using formula

Annual depriciation = (original cost - salvage value) / useful life in years

For ex.

Suppose a company produces a machinery of 1 lac and useful life is 10 years, and salvage value is 20000

then,

annual depriciation = (100000 - 20000) / 10 = 8000

for given question, salvage value and useful life needs to be given to obtain the answer. Original cost is 1750

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