18 A machine costing $$ \overline{\overline{K 15} 000} $$ is to be depreciated on the reducing balance method at $$ 10 \% $$ per annum. Calculate the depreciation for the first three years. $$ =\frac{ ext { book value } imes 6 ext { ate of depreciate }}{100} $$

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18 A machine costing $$ \overline{\overline{K 15} 000} $$ is to be depreciated on the reducing balance method at $$ 10 \% $$ per annum. Calculate the depreciation for the first three years. $$ =\frac{	ext { book value } 	imes 6 	ext { ate of depreciate }}{100} $$

UpStudy AI · Accepted Answer

1. **Initial Cost**

The machine costs $$15000$$.

2. **Year 1**

- **Depreciation:**
     
     Using the formula
     
     $$
     \text{Depreciation} = \frac{\text{Book Value} \times \text{Rate}}{100},
     $$
     
     the depreciation for the first year is
     
     $$
     \frac{15000 \times 10}{100} = 1500.
     $$
     
   - **Book Value at End of Year 1:**
     
     $$
     15000 - 1500 = 13500.
     $$

3. **Year 2**

- **Depreciation:**
     
     The book value at the beginning of Year 2 is $$13500$$. Thus,
     
     $$
     \frac{13500 \times 10}{100} = 1350.
     $$
     
   - **Book Value at End of Year 2:**
     
     $$
     13500 - 1350 = 12150.
     $$

4. **Year 3**

- **Depreciation:**
     
     The book value at the beginning of Year 3 is $$12150$$. Hence,
     
     $$
     \frac{12150 \times 10}{100} = 1215.
     $$
     
   - **Book Value at End of Year 3:**
     
     $$
     12150 - 1215 = 10935.
     $$

**Summary:**

- Year 1 Depreciation: $$1500$$
- Year 2 Depreciation: $$1350$$
- Year 3 Depreciation: $$1215$$
Depreciation for the first three years is: - Year 1: \$1,500 - Year 2: \$1,350 - Year 3: \$1,215

18 A machine costing is to be depreciated on the reducing balance method at
per annum. Calculate the depreciation for the first three years.

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18 A machine costing is to be depreciated on the reducing balance method at per annum. Calculate the depreciation for the first three years.