Solution the cost basis for the furniture 200000 30000

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Unformatted text preview: ar? Solution: The cost basis for the furniture = 200,000 + 30,000 = $230,000 Using straight line method (depreciation is same for all years) ( ) b. What is the BV of the asset at the end of the first year? Solution: c. What is the BV of the asset after 10 years? Solution: ( 1|Page ) NAME (Printed): _________________,________________ (Last) (First) IE 343 –HW #8 Due: Nov. 1, 2013 Problem 2 A useful piece of depreciable property was bought for $30,000. If it has a useful life of 10 years and a salvage value of $7,000, how much will it be depreciated in the 9th year, using the 150% declining balance method? Solution: R=1.5/10 = 0.15 (150% DB method) B = $30,000 () ( () ( ( : Annual depreciation deduction in year k (1 ≤ k ≤ N) ) ) : Cumulative depreciation through year k ) : Book value at end of year k ( )( ( We have ) ) ( ( ( ) ) ) As the salvage value is $7,000, the property in year 9 can only be depreciated by an amount . 2|Page NAME (Printed): _________________,________________ (Last) (First) IE 343 –HW #8 Due: Nov. 1, 2013 Problem...
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This note was uploaded on 11/05/2013 for the course IE 343 taught by Professor Vincent,g during the Fall '08 term at Purdue University.

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