Question

Cnbc reported that one in five consumers who purchase bitcoin do so using their credit card. Melissa Gamez purchased a used RV with 19,800 miles for 47,700. Originally the RV sold for 74,000 with a residual value of 20,800. After subtracting the residual value, what was the depreciation allowance per mile?

Answer 1

The depreciation allowance per mile for the RV is calculated by subtracting the residual value from the original cost and dividing by the total miles. It results in a depreciation allowance of $2.69 per mile.

Step-by-step explanation:

The question asks us to calculate the depreciation allowance per mile for Melissa Gamez's used RV. To find this, we'll use the formula for straight-line depreciation, which is (original cost - residual value) / total miles at the time of purchase.

The original cost of the RV was $74,000 and the residual value is $20,800. Melissa purchased the RV with 19,800 miles on it. So, the total depreciation is $74,000 - $20,800 = $53,200. To find the depreciation allowance per mile, we divide the total depreciation by the number of miles, which gives us $53,200 / 19,800 miles = $2.69 per mile.