Calculate the sinking fund depreciation allowance for a company-owned executive car having a cost basis of ($60,000.)

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Calculate the sinking fund depreciation allowance for a company-owned executive car having a cost basis of $$60,000.$ The company will keep it for 3 years, and it can be sold at $$25,000$ at that time. Interest is 10 percent.

a. Determine the sinking fund depreciation for each of the 3 years.

b. Why is this depreciation method considered to be back-end loaded?

c. Why is sinking fund out of favor as a depreciation strategy?

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Principles Of Engineering Economic Analysis

ISBN: 9781118163832

6th Edition

Authors: John A. White, Kenneth E. Case, David B. Pratt

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Question Posted: Apr 01, 2024 07:23 AM

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Calculate the sinking fund depreciation allowance for a company-owned executive car having a cost basis of ($60,000.)

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Principles Of Engineering Economic Analysis

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