Question

Ayayai Corp. bought equipment on January

1, 2017. The equipment cost $470000 and
had an expected salvage value of $70000.
The life of the equipment was estimated to
be 6 years. The depreciable cost of the
equipment is

Answer 1

The depreciable cost of the equipment is $400,000

Step-by-step explanation:

In this question, we are tasked with calculating the depreciable cost of the equipment bought

To calculate this, we simply engage the use of a mathematical relation

Mathematically;

Depreciable cost = Original Cost - Salvage value

From the question, the original cost is $470,000

The salvage value = $70,000

Inputing these values into the equation, we have

Depreciable cost = $470,000 -$70,000 = $400,000