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Accounting Careers: Accounting homework help

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    • CommentAuthorAnjel1
    • CommentTimeOct 16th 2009
     
    Send me your accounting & finance assignments and i will send you back the answers. I also help in projects, papers and essays.

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    • CommentAuthorawood515
    • CommentTimeOct 16th 2009
     
    Using the simplified straight-line method over 5 years. It is assumed that the plant and equipment will have no salvage value after 5 years. Cost of new plant and equipment is $20,900,000; shipping and installation costs are $300,000; Units sales are 1st year 100,000; 2nd year 130,000; 3rd year 160,000; 4th year 100,000 and finally the 5th year is 60,000 units sold.

    The depreciation for years 1-4 is $4,240,000, I just can't figure out how they got this answer. Could you please show me how they got this answer?

    Thanks
    awood515
  3.  
    HI

    This method of 5 years simplified line and the ratio of analysis go to flow.http://www.avicennaaccounting.com
    • CommentAuthorjzill
    • CommentTimeNov 2nd 2009 edited
     
    @awood515:

    The depreciation figure comes from adding the $300,000 installation cost to the cost of the fixed asset (add all costs associated with getting the asset ready for its intended use). This makes the total cost $21,200,000. Divide this total by 5 and there's your answer.

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