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07 Nov 2024, 10:26
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Scrap value of machine A: $2,500
Annual depreciation of machine B: $1,375
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
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26%
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Two manufacturers produce the equipment required by a factory, at roughly equivalent prices of about $25,000. The life spans of the two possible acquisitions differ, however, as do the scrap value of the machines. Machine A depreciates $2,250 per year and has an expected life of 10 years. Machine B has a life span of 16 years and a scrap value of $3,000. Find the scrap value of machine A and the annual depreciation of machine B.
| Scrap value of machine A | Annual depreciation of machine B | |
| $1,250 | ||
| $1,375 | ||
| $1,500 | ||
| $2,250 | ||
| $2,500 | ||
| $2,750 |
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Official Answer
Scrap value of machine A: $2,500
Annual depreciation of machine B: $1,375
08 Nov 2024, 11:00
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1. We are asked to find the scrap value of machine A and the annual depreciation of machine B.
2. Let's review these 2 terms. The scrap value is how much the machine will cost after its expected life. The annual depreciation is how much money the machine uses up per year over its expected life. Knowing all of this, we have the formula: \(StartingPrice - ExpectedLife * AnnualDepreciation = ScrapValue\). The starting price for both machines is around $25000: \($25000 - ExpectedLife * AnnualDepreciation = ScrapValue\).
3. Scrap value of machine A. Using the information from the text, we have: \($25000 - 10 * $2250 = ScrapValue \rightarrow ScrapValue = \)$2500.
4. Annual Depreciation of machine B. Using the information from the text, we have: \($25000 - 16 * AnnualDepreciation = $3000 \rightarrow AnnualDepreciation = \frac{$22000}{16} = \)$1375.
5. So, our answer is: the scrap value of machine A = $2500 and the annual depreciation of machine B = $1375.
2. Let's review these 2 terms. The scrap value is how much the machine will cost after its expected life. The annual depreciation is how much money the machine uses up per year over its expected life. Knowing all of this, we have the formula: \(StartingPrice - ExpectedLife * AnnualDepreciation = ScrapValue\). The starting price for both machines is around $25000: \($25000 - ExpectedLife * AnnualDepreciation = ScrapValue\).
3. Scrap value of machine A. Using the information from the text, we have: \($25000 - 10 * $2250 = ScrapValue \rightarrow ScrapValue = \)$2500.
4. Annual Depreciation of machine B. Using the information from the text, we have: \($25000 - 16 * AnnualDepreciation = $3000 \rightarrow AnnualDepreciation = \frac{$22000}{16} = \)$1375.
5. So, our answer is: the scrap value of machine A = $2500 and the annual depreciation of machine B = $1375.
23 Nov 2024, 14:09
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Machine A:
original price $25000- $2,250*10 = $2500
Machine B:
original price $25000- $3000 = $22000/16 = $1375
Machine A= $2500
Machine B= $1375
original price $25000- $2,250*10 = $2500
Machine B:
original price $25000- $3000 = $22000/16 = $1375
Machine A= $2500
Machine B= $1375
