1. You purchase an advanced stereo system and other music equipment at the initial cost of $3,000. You plan to use this equipment for ten years. The estimated salvage value for the equipment is $200. This is what you expect to sell the equipment for when it's no longer usable.

2. Using the same example as in the straight-line method, you know that the initial depreciation is 10% every year based on an initial purchase price of $3,000. Again, this is because the equipment's expected lifespan is 10 years.

1. Aecord the following gort transactions, based an a perpetual merchandise inveritory roe shippine point, involce H17th. Oct 13 sold merchandtse with a retatt value of $8,400 and a cest of $8,720 to Elite corp. with terms of 1/10,1/30, rob shipping point: ocr is Paid $1,400 for freight charges on the merchandise purchased on 0CY7 Oct 17 Paid shepard Corp. for the purchase on OCT 7 oct 22 Received the balance due from Elite Corp. OCT 26 Sold merchandise with a cost of $9,280 for $11,600 on credit to Hacienda inc. NOV 23 Sold merchandise with a cost of $5,120 for $6,400 on credit to Grandview Corpi) terms of 1/10,n/30 Dec 9 Received the balance due from Grandview Corp. for merchandise sold on NOV, 23 Dec 25 5old merchandise with a cost of $2,004 for $3,600 on credit to Buchman Corp. Dec 30 Sold merchandise with a cost of $2,200 for $4,440 on credil to Decker Corp