Some equipment costs $1000, has a 5-year depreciable life, and an estimated $50 salvage value at the

Question:

Some equipment costs $1000, has a 5-year depreciable life, and an estimated $50 salvage value at the end of that time. You have been assigned the problem to determine whether to use straight-line or SOYD depreciation. If a 10% interest rate is appropriate, which is the preferred depreciation method for this profitable corporation? Use a spreadsheet to show your computations of the Difference in present worth’s.

Depreciation
Depreciation is an important concept in accounting. By definition, depreciation is the wear and tear in the value of a noncurrent asset over its useful life. In simple words, depreciation is the cost of operating a noncurrent asset producing... 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...