Question

Deep Blue, a deep sea fishing company, bought a boat for $250,000. After 9 years, Deep Blue plans to sell it for a scrap value of $95,000. Assume linear depreciation.

Answer 1

Answer:

Therefore, we use the  linear depreciation and we get is 17222.22 .

Step-by-step explanation:

From Exercise we have that  is boat  $250,000.

The straight line depreciation for a boat  would be calculated as follows:

Cost  boat is $250,000.  

For  $95,000 Deep Blue plans to sell it after 9 years.

We use the formula and we calculate :

(250000-95000)/9=155000/9=17222.22

Therefore, we use the  linear depreciation and we get is 17222.22 .