A 60 000 asset will be depreciated by the straightline metho

A $60 000 asset will be depreciated by the straight-line method over a six-year period. NO salvage value is expected. If the company\'s tax rate is 50°h, what would be the present-worth advantage of using the sum-of-years7 -digits method, given a 10% after-tax MARR?

Useful life of asset = 6 Years

Sum of years digits = 6 + 5 + 4 + 3 + 2 + 1 = 21

Depreciation amount for each year = (A) * (B)

Year	Depreciable amount (A)	Depreciation base (B)	Depreciation amount for each year *= (A) (B)**
1	60000	6/21	17143
2	60000	5/21	14286
3	60000	4/21	11428
4	60000	3/21	8572
5	60000	2/21	5714
6	60000	1/21	2857
Total			60000

$A $60 000 asset will be depreciated by the straight-line method over a six-year period. NO salvage value is expected. If the company\'s tax rate is 50°h, what w$

A 60 000 asset will be depreciated by the straightline metho

Solution

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