Using linear depreciation, how do you determine the value of a machine after 5 years if it costs $62310 when new and has a value of $32985 after 7 years?

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Answer 1 · 2018-01-19T11:32:59

The value of the machine after $5$ years is $$41364$

Initial cost of the machine is $y_1=$62310.00 , x_1=0$

Depriciated value of the machine after $x_2=7$ years is

$y_2=$32985.00$ .Linear depriciation slope per year is

$m= (y_2-y_1)/(x_2-x_1)or m=(32985.00-62310.00)/(7-0)$

$m=(32985.00-62310.00)/7$ . Depriciated value of the

machine after $x=5$ years is $y-y_1= m(x-x_1)$ or

$y-62310= (32985.00-62310.00)/7*(5-0)$ or

$y= 62310+ (32985.00-62310.00)/7*5$ or

$y=62310-20946.43 or y ~~ $41363.57 ~~ $41364$

The value of the machine after $5$ years is $$41364$