"Showing both acquisition cost and accumulated depreciation amounts separately provides a rough indication of the relative age of the firm's long-lived assets."

a. Assume that the Dickens Company acquired an asset with a depreciable cost of

$100,000 and no salvage value several years ago. Accumulated depreciation as of December 3 1 , recorded on a straight-line basis, is $60,000. The depreciation charge for the year is $10,000. What is the asset's depreciable life? How old is the asset?

b. Assume straight-line depreciation. Devise a formula that, given the depreciation charge for the year and the asset's accumulated depreciation, you can use to estimate the age of the asset.

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