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Financial Maths, SMB-014

Rae paid  $40 000  for new office equipment at the start of the 2019 financial year.

At the start of each following financial year, she used straight-line (flat rate) depreciation to revalue her equipment.

At the start of the 2022 financial year she revalued her equipment at  $22 000.

Calculate the annual straight-line rate of depreciation she used, as a percentage of the purchase price.  (2 marks)

--- 4 WORK AREA LINES (style=lined) ---

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`15text(%)`

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`text(Depreciation over 3 years)`

♦ Mean mark 50%.

`=40\ 000-22\ 000`

`=$18\ 000`
 

`:.\ text(Annual depreciation) = (18\ 000)/3 = $6000`

`:.\ text(Depreciation rate) = 6000/(40\ 000) = 0.15 = 15text(%)`

Filed Under: Depreciation Tagged With: num-title-ct-coreb, smc-4335-60-Straight-line

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