Question5 [20marks]

Usethestraight linemethodtofindtheannualdepreciationforavanthatcosts$18,000, has an expected life of 3 years and has a salvage value of$3,000.

(4 Marks)

The cost of a fishing boat is $150,000. The declining balance method is used for computing depreciation. If the depreciation rate is 15 percent, compute the book value and accumulated depreciation of the boat at the end of 5years.

(6 Marks)

A new equipment costing $10,000 is purchased. Using a declining balance rate of 12 percent, find the book value at the end of 5years.

(4 Marks)

Construct a depreciation schedule using the straight line method for a new truck that costs $80,000 and has a salvage value of $8,000 at the end of 6years.

(6 Marks)