Question

Nobel Appliances purchased office furniture for a cost of $16,000. The furniture has an estimated life of 10 years and has an annual depreciation of $1,500. What is the salvage value of the furniture?

Answer 1

Answer: The salvage value of the furniture is $1000.

Explanation:

The salvage value is the estimated resale value of an asset at the end of its useful life.

Given: The cost price of the furniture = $16000

Since the furniture has an estimated life of 10 years and has an annual depreciation of $1,500.

The salvage value=
`\$16000-10*\$1500`

⇒ The salvage value=
`\$16000-15000=\$1000`

hence, the salvage value of the furniture is $1000.