It Is Known That the Book Value of an Asset

question 50

Essay

It is known that the book value of an asset depreciated through declining balance depreciation is
$3 000 in year 3. Purchase price of the asset was $3 800. What is the asset's salvage value at the end of its useful life, which is 10 years?

---

Definitions:

Direct Labor-Hours

The total hours of work directly involved in manufacturing goods or providing a service.

Variable Overhead

The costs that fluctuate with the level of production output and may include expenses such as utilities and indirect materials.

Direct Materials

Raw materials that can be directly attributed to the manufacturing of a product.

Direct Labor-Hours

Overall hours employees spend directly involved in the fabricating process.