If the roof a property cost $14,000 and its economic life is 18 years, what would its value be after four years using a straight-line method of depreciation?

Given:

Cost of the roof of a property = $14,000

Economic life = 18 years

To find: value after 4 years using straight-line depreciation method. Solution:

Loss of value per year = cost of roof of property / economic life of property

14000/18 = $777.78

Every year, value of property is getting depreciated by $777.78.

So, value after four years is calculated below:

Value after 1 year = $ (14000 - 777.78) = $13222.22

Value after 2 year = $ (13222.22 - 777.78) = $12444.44

Value after 3 year = $ (12444.44 - 777.78) = $11666.66

Value after 4 year = $ (11666.66 - 777.78) = $10888.88

Value after four years = $10888.88