You purchased a piece of machinery for $180,000. The machine's salvage value is $5,000 and its useful life span is 10 years. a) Using Straight Line Depreciation, what is the annual depreciation?b) Write an equation that relates Value to Time using the information given above.c) What would be the machine's value at the end of 6 years?d) What would be its value after 14 years?
a) (180,000 - 5,000) / 10 = $17,500 per year b) Value = Purchase Price - (Annual Depr. * Years in Service) Not sure if this is what you're looking for. c) 180,000 - (17,500 * 6) = $75,000 d) Anytime after 10 years, value will simply be Salvage Value ($5,000).
