a certain car was purchased for $18,900. the car has a resale value of $12,300 after a useful life of 6…
a certain car was purchased for $18,900. the car has a resale value of $12,300 after a useful life of 6 years. what is the book value of this car after 3 years? annual depreciation expense = $1,100 book value = $?
Answer
Explanation:
Step1: Recall book - value formula
The formula for book value is $Book\ value=Initial\ cost - (Annual\ depreciation\times Number\ of\ years)$.
Step2: Identify given values
The initial cost of the car is $18900$, the annual depreciation expense is $1100$, and the number of years is $3$.
Step3: Calculate the depreciation amount
The depreciation amount after 3 years is $1100\times3 = 3300$.
Step4: Calculate the book value
$Book\ value=18900 - 3300=15600$.
Answer:
$15600$