a certain car was purchased for $20,400. the car has a resale value of $12,000 after a useful life of 8…

a certain car was purchased for $20,400. the car has a resale value of $12,000 after a useful life of 8 years. what is the book value of this car after 5 years? annual depreciation expense = $1,050 book value = $? round to the nearest hundredth.

a certain car was purchased for $20,400. the car has a resale value of $12,000 after a useful life of 8 years. what is the book value of this car after 5 years? annual depreciation expense = $1,050 book value = $? round to the nearest hundredth.

Answer

Explanation:

Step1: Recall book - value formula

The formula for book - value is $BV = P-DE\times n$, where $P$ is the purchase price, $DE$ is the annual depreciation expense, and $n$ is the number of years. Here, $P = 20400$, $DE=1050$, and $n = 5$.

Step2: Substitute values into formula

$BV=20400 - 1050\times5$. First, calculate $1050\times5=5250$. Then, $BV = 20400-5250$. $BV=15150$.

Answer:

$15150.00$