A commercial generator with an unadjusted basis of $50,000 is straight line depreciated over a 5-year period.

Question:

A commercial generator with an unadjusted basis of $50,000 is straight line depreciated over a 5-year period. The asset will have an AOC of $35,000 and a salvage value of $10,000. The book value at the end of year 3 will be closest to:

(a) $8000

(b) $20,000

(c) $24,000

(d) $26,000

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...
Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Engineering Economy

ISBN: 978-0073523439

8th edition

Authors: Leland T. Blank, Anthony Tarquin

Question Posted: