Straight-line Methods

# Straight-line Methods - * StraightLineExample#1

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Straight-Line Example #1 On a straight-line depreciation system, a  \$100,000 , 3- year machine with  no salvage value  will be  depreciated over THREE  years, according to the  following schedule: Year 1 Depreciation: [(cost - salvage)/life] =  33,334 Year 2 Depreciation: [(cost - salvage)/life] =  33,333 Year 3 Depreciation: [(cost - salvage)/life] =  33,333 Total Straight Line Depreciation:  (33,334+33,333+33,333) = \$100,000 * Straight-Line Example #2 Suppose you purchase a new machine for  \$900,000 . The  machine will be depreciated Straight-Line over  10  years  with a  \$59,000   salvage  value.   What will be the yearly depreciation for this machine? * Straight-Line Example #3 Suppose you purchase a new machine for  \$1,455,555 . The  machine will be depreciated Straight-Line over  15  years  with a  \$555 salvage  value.   What will be the yearly depreciation for this machine? * Net Working Capital

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## This note was uploaded on 11/21/2011 for the course BUS M 301 taught by Professor Jimbrau during the Summer '11 term at BYU.

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Straight-line Methods - * StraightLineExample#1

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