A machine with a 10 year life is MACRS depreciated The machine has a first cost of $40,000 with a $5000 salvage value Its annual operating cost is $7000 per year, and d t for years 1, 2, and 3 is 10 00 , 18 00 , and 14 40 , respectively The depreciation charge in year 3 is nearest to (a) $5800 (b) ...

A machine with a 10-year life is MACRS depreciated. The machine has a first cost of $40,000

Question:

A machine with a 10-year life is MACRS depreciated. The machine has a first cost of $40,000 with a $5000 . Its annual operating cost is $7000 per year, and d t for years 1, 2, and 3 is 10.00%, 18.00%, and 14.40%, respectively. The depreciation charge in year 3 is nearest to:
(a) $5800
(b) $7200
(c) $8500
(d) $9300

Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...