Subject: Engineerings Economics Topics: Double Declining Balance Method(DDBM)1. Sum-of-the-Years’-Digits (SYD) MethodOffice equipment ost P14,000, has a useful life of 12 years, and a salvage value of P1,000. Using the sum of years digit method, find the value of the depreciation during the first year. USE THE REFERENCES AND FORMULA BELOW (ATTACHED ON THE PICTURE) (SYD) Methoddn = depreciation charge during the nth yeard = (depreciation factor) x (total depreciation)(C₁-C₂)→ Sum-of-the-Years'-Digitsreverse digitsum of digitsLyears =(L + 1)dn=Example: a property whose life is 5 yearsYearinReverse Order5Year12433425115 = { of digitsstDepreciationfactor5/154/153/152/151/15Depreciation during theyear(5/15) (C. - C₂)(4/15) (C. - C₂)(3/15) (C. - C₁)(2/15) (C. - C₂)(1/15) (Co-C₂) References:Blank, L. & Tarquin, A. (2018). Engineering Economy (8th Ed.). McGraw-Hill Education.Sullivan, W., Wicks, E. & Koelling, C. P. (2014). Engineering Economy (16th Ed.). Pearson Education SouthAsia Pte Ltd.Sta. Maria, H. (2000). Engineering Economy (3rd Ed.). National Book Store.Arreola, M. (1993). Engineering Economy (3rd Ed.). Ken Incorporated.

Initial cost C0=14,000 Useful service life (L)=12 years Salvage value CL=1000 Depreciation method:…

Answered: Office equipment ost P14,000, has a…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Question

Subject: Engineerings Economics
Topics:
Double Declining Balance Method(DDBM)
1. Sum-of-the-Years’-Digits (SYD) Method

Office equipment ost P14,000, has a useful life of 12 years, and a salvage value of P1,000. Using the sum of years digit method, find the value of the depreciation during the first year.

USE THE REFERENCES AND FORMULA BELOW (ATTACHED ON THE PICTURE)

(SYD) Method
dn = depreciation charge during the nth year
d = (depreciation factor) x (total depreciation)
(C₁-C₂)
→ Sum-of-the-Years'-Digits
reverse digit
sum of digits
L
years =(L + 1)
dn
=
Example: a property whose life is 5 years
Year
in
Reverse Order
5
Year
1
2
4
3
3
4
2
5
1
15 = { of digits
st
Depreciation
factor
5/15
4/15
3/15
2/15
1/15
Depreciation during the
year
(5/15) (C. - C₂)
(4/15) (C. - C₂)
(3/15) (C. - C₁)
(2/15) (C. - C₂)
(1/15) (Co-C₂)

References:
Blank, L. & Tarquin, A. (2018). Engineering Economy (8th Ed.). McGraw-Hill Education.
Sullivan, W., Wicks, E. & Koelling, C. P. (2014). Engineering Economy (16th Ed.). Pearson Education South
Asia Pte Ltd.
Sta. Maria, H. (2000). Engineering Economy (3rd Ed.). National Book Store.
Arreola, M. (1993). Engineering Economy (3rd Ed.). Ken Incorporated.

Expert Solution

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions