Question

Thomas purchased a used vehicle that depreciates under a straight-line

method. The initial value of the car is $7000, and the salvage value is $500. If
the car is expected to have a useful life of another 5 years, how much will it
depreciate each year?
O
A. $1300
O B. $1000
O c. $7000
O D. $5000

Answer 1

Answer: A. $1300

Explanation:

The initial value is $7000

The Salvage value is $500

The car will depreciate under a straight-line method, meaning it will lose $6500 value in 5 years.

6500 / 5 = 1300