3. Your company has purchased a large new truck-tractor for over-the-road use for $220,000. It's estimated salvage value at the end of a 10 year life is $10,000. a) If straight-line depreciation is used, what would be the depreciation deduction in year 2? b) If 200% declining balance depreciation is used (R-2/10), what would be the depreciation deduction in year 2? c) If MACRS depreciation is used with a GDS recovery period of 5 years, what would be the book value of the asset after two years of depreciation? For a 5-year asset, r₁=0.2, r2-0.32, rs-0.192, r4-0.1152, rs-0.1152, r6 -0.0576
3. Your company has purchased a large new truck-tractor for over-the-road use for $220,000. It's estimated salvage value at the end of a 10 year life is $10,000. a) If straight-line depreciation is used, what would be the depreciation deduction in year 2? b) If 200% declining balance depreciation is used (R-2/10), what would be the depreciation deduction in year 2? c) If MACRS depreciation is used with a GDS recovery period of 5 years, what would be the book value of the asset after two years of depreciation? For a 5-year asset, r₁=0.2, r2-0.32, rs-0.192, r4-0.1152, rs-0.1152, r6 -0.0576
Chapter11: Long-term Assets
Section: Chapter Questions
Problem 15PB: Urquhart Global purchases a building to house its administrative offices for $500,000. The best...
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