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i have an asset worth £500,000. It has a life span of 4 years. The depreciation rate will be 15%pa (per Annam/year) using straight line method.
500,000 / 100 x 15 = 75,000
Year 1 dep = 75,000
Year 2 dep = 75,000
Year 3 dep = 75,000
Year 4 dep = 75,000
I have an asset worth £500,000, it has a life span of 4 years. The depreciation rate will be 15% pa (per Annam/year) using NBV method. NBV = net book value
500,000/100 x 15 = 75,000
Year 1 dep = 75,000 NBV of asset now = 425,000
Year 2 dep = 425,000/100 x 15 = 63,750 NBV of asset now = 361,250
Year 3 dep = 361,250/100 x 15 =54,187.50 NBV of asset now = 307,062.50
year 4 dep = 307,062.50/100 x 15 = 46,059.36 NBV of asset now = 261003.14
I hope this will help you with your understanding of deprecation values.
What else can I help you with?
What is the different sum-of-the-year digits method versus the straight line method?
Straight line depreciation method allocate equal amount for all years while in sum of years digit method depreciation is allocated with high amount in initial years while low amount in later years.
How is the straight line depreciation method different from declining balance method?
Under straight line depreciation, fixed amount of depreciation is charged to every year while in declining balance method depreciation percentage remains same but depreciation is charged on remaining balance of asset due to which the amount of depreciation is different in every year.
Diminishing balance method of deprecation in the financial statements be more conservative or less conservative than the current practice of using the straight-line method?
The diminishing balance method of depreciation is generally considered less conservative than the straight-line method as it results in higher depreciation expenses in the earlier years of an asset's life. This reflects a more aggressive approach in recognizing depreciation compared to the straight-line method, which spreads depreciation evenly over the useful life of the asset.
What is the different between straight line method and reducing balance method result?
The straight line method calculates the depreciation of an asset for a specific period of time, while reducing balance method calculates the depreciation for a provisional rate of an asset.
What is the amount of the annual depreciation computed by the straight-line method for a refrigerator used by a meat processor that cost 198500 and estimated value of 30500 with a useful life of 15yrs?
The annual depreciation for the refrigerator using the straight-line method would be calculated as follows: (Cost of the refrigerator - Estimated salvage value) / Useful life = ($198,500 - $30,500) / 15 years = $168,000 / 15 years = $11,200 per year.
Straight line method of depreciation?
Straight line depreciation method is that method in which fixed amount of depreciation is charged to all fiscal years in which that asset is used.
Depreciation straight line method?
Straight line depreciation method is that method in which fixed amount of depreciation is charged to all fiscal years in which that asset is used.
Which type of depreciation method accelerates depreciation in the early years of an asset life?
Straight line
What is the different sum-of-the-year digits method versus the straight line method?
Straight line depreciation method allocate equal amount for all years while in sum of years digit method depreciation is allocated with high amount in initial years while low amount in later years.
How is the straight line depreciation method different from declining balance method?
Under straight line depreciation, fixed amount of depreciation is charged to every year while in declining balance method depreciation percentage remains same but depreciation is charged on remaining balance of asset due to which the amount of depreciation is different in every year.
Which type of depreciation method accelerates depreciation in the early years of an asset's life?
Diminishing value method where you depreciate the asset by a percentage rather than the straight line method where the same amount gets depreciated each year.
What is srtaight line method?
Straight line method of depreciation is that under which any asset is depreciated in equal amount for every year till salvage value. Formula for straight line method: Depreciation = (Cost price - Salvage Value)/Number of years
Diminishing balance method of deprecation in the financial statements be more conservative or less conservative than the current practice of using the straight-line method?
The diminishing balance method of depreciation is generally considered less conservative than the straight-line method as it results in higher depreciation expenses in the earlier years of an asset's life. This reflects a more aggressive approach in recognizing depreciation compared to the straight-line method, which spreads depreciation evenly over the useful life of the asset.
What is the different between straight line method and reducing balance method result?
The straight line method calculates the depreciation of an asset for a specific period of time, while reducing balance method calculates the depreciation for a provisional rate of an asset.
How many methods of calculating depreciation?
Following are different methods of depreciation: 1 - Straight line method 2 - Diminishing balance method 3 - Double declining method 4 - Sum of years method 5 - MACRS
What disclosure is required for a change from sum of the years digits to a straight line Method?
re-computation of current and future years' depreciation
Cost is 410000 will be deprictated straight line to 0 for five years?
To calculate the annual depreciation using the straight-line method, divide the total cost of the asset ($410,000) by its useful life (5 years). This results in an annual depreciation expense of $82,000 per year. At the end of five years, the asset will have a book value of $0.
