Blg Trucking Company has purchased a $100,000 dump truck that has a uselul life of 8 years. After the first year of use, the marketvalue of the dump truck falls to $70,000. What are the accounting and economic depreciation of the truck, respectively?O S30000, S12500O S70000, 825000• $12500, S30000O S10000, $10000

Here we calculate the accounting and economic depreciation of the truck by using the given information and choose the correct option , so the calculation of the following by using the given information which are as follow-C ) 12500 , 30,000 because here , Accounting depreciation charged over the useful life of an asset. Price of Truck= $100,000 Useful life = 8 years. Accounting Depreciation = Price of truck/ Useful life in years Accounting Depreciation= $100,000/ 8 Accounting Depreciation= $12,500 so here we conclude that here Accounting Depreciation is $12500 Economic depreciation is the decrease in market value of the truck after one year. Economic Depreciation = $ 100,000 - $70,000 Economic Depreciation= $30000 so here we conclude that here Economic Depreciation is $30,000 so as per calculation here we conclude that ,only option C is correct

Business

Economics

Bg Trucking Company has purchased a $100,000 dump truck that has a uselul ife of 8 years. After the first year of use, the market vale of the dump truck lalls to $70,000. What are the accounting and economic depreciation of the truck, respectively? O 30000, $12500 $70000, $25000 O $12500, S30000 $10000, $10000

Bg Trucking Company has purchased a $100,000 dump truck that has a uselul ife of 8 years. After the first year of use, the market vale of the dump truck lalls to $70,000. What are the accounting and economic depreciation of the truck, respectively? O 30000, $12500 $70000, $25000 O $12500, S30000 $10000, $10000

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

All subpart in 1 question
A contractor imported a bulldozer paying P350k to the manufacturer, freight & insurance charges amounted to P18k, permits & other exp P25k. If the contractor estimates the life of the bulldozer to be 15 years with salvage value of P30k, determine the Total depreciation at the end of 11 years using Sinking fund at 10%. a. P112,718.231 b. P121,718.231 c. P111,718.231 d. P211,718.231
3. An investment of $180,000 with a salvage value of $30,000 in 10 years can reduce annual operating cost by $36,000. Use MACRS with depreciation life of 5 years and effective tax of 38% to calculate the present worth of ATCF. MARR= 10%
Using the following information, calculate the Net Value Added at Factor Cost. Sales 25000 Excise Duty 5000 1000 -500 7000 Depreciation Change in Stock Intermediate Cost O a. 11000 O b. 10500 O c. O d. 12500 11500
A relatively small privately owned coal-mining company has the sales results summarized below. Determine the annual percentage depletion for the coal mine. Assume the company’s taxable income is $150,000 each year. Year Sales, Tons Spot Sales Price, $/Ton 1 34,300 9.82 2 50,100 10 3 71,900 11.23 Year Gross Income, $ Depletion amount 50% of the taxable amount Allowed Depletion 1 2 3
A mining corporation purchased $120,000 of production machinery and depreciated it using 40% bonus depreciation with the balance using 5-year MACRS depreciation, a 5-year depreciable life, and zero salvage value. The corporation is a profitable one that has a 22% combined incremental tax rate.At the end of 5 years the mining company changed its method of operation and sold the production machinery for $40,000. During the 5 years the machinery was used, it reduced mine operating costs by $32,000 a year, before taxes. If the company MARR is 12% after taxes, was the investment in the machinery a satisfactory one?
First cost of equipment = $200,000 Market value at the end of year 6 = $10,000 MACRS depreciation is used. The equipment is a 5-year property. Incremental income-tax rate for the company = 35% Year 0 1 2 3 4 5 6 BT-CF in $ -200K 60K 63K 66K 69K 72K 75K Market value = 10K The first-year after tax-cash flow is equal to _____________.
None
RZ Company, a calendar year taxpayer, paid $6,400,000 for a commercial office building and allocated $400,000 of the cost to the land and $6,000,000 of the cost to the building. RZ place the realty in service on May 11. Refer to the appropriate MACRS Table in Chapter 7 to compute RZ's first-year depreciation on the realty. Use Table 7-4. Multiple Choice $136,380 $102,720 $96,300 None of these choices are correct
ENGINEERING ECONOMY
Please don't copy ans
ENGINEERING ECONOMY