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18 December, 09:02

Ex 9-9 Straight-line depreciation ObJ. 2

A refrigerator used by a meat processor has a cost of $48,000, an estimated residual value of $9,000, and an estimated useful life of 15 years. What is the amount of the annual depreciation computed by the straight-line method?

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  1. 18 December, 09:19
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    Depreciation = (Cost - Residual) / Useful Life

    Cost = $48,000

    Residual = $9,000

    Useful Life = 15 years

    Depreciation = (48,000-9,000) / 15

    Depreciation = 39,000/15

    Depreciation = $2,600

    The refrigerator will depreciate at $2,600 a year.
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