Question

If the cost of the asset is 20,000; scrap value is 5,000; life is 5 years, the amount of depreciation per year will be.
A) 3000
B) 4000
C) 5000
D) 3500

Answer 1

Answer:

A) 3000

20000-5000/5

= 15000/5

=3000

Answer 2

Answer:

A) 3,000

The amount of depreciation per year will be 3,000

Explanation:

Given :

• The cost of the asset = 20,000
• Scrap value = 5,000
• Estimated useful life of Asset in years = 5

To find :

• The amount of depreciation per year

Solution :

★  Annual Depreciation :

• Annual Depreciation =

= Total cost of asset - scrap value / Estimated useful life of asset

• Annual Depreciation :

⇒ $\frac{ (Total Cost Of Asset - Scrap Value)}{Estimated \: Useful \: Life \: Of \: Asset}$

⇒ $\frac{20,000 - 5,000}{5}$

⇒ $\frac{15,000}{5}$

⇒ $\frac{15,000}{5} = 3,000$

⇒ 3,000

Annual Depreciation = 3,000

Therefore,

A) 3,000

The amount of depreciation per year will be 3,000 ___________________________