Question
Home Health Care, Inc. (HHCI) purchased a new sonargram imaging unit for $300,000 and had it mounted on the truck body for an additional $100,000,
Home Health Care, Inc. (HHCI) purchased a new sonargram imaging unit for $300,000 and had it mounted on the truck body for an additional $100,000, including the truck chassis. The unittrack system will be depreciated as one asset. The function life is 8 years, and salvage is estimated at 10% of the purchase price of the imaging unit. (a) Use classical straight line depreciation, and hand calculations to determine the salvage value, annual depreciation, and book value after 4 years. (b) Develop the cell reference worksheet in excel to obtain the answer in part (a) for the original data. (c) Use your Excel worksheet to determine the answer, if the sonargam unit cost goes up to $350,000 and the expected life is decreased to 5 years.
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