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# A company that manufactures personal hygiene items purchases machinery for $220,000 that is considered to last 7 years; it is estimated that at the end of the period it will have a salvage value of$1000. Find: to. The depreciation rate. b. The book value at the end of the sixth year.

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## Answer to a math question A company that manufactures personal hygiene items purchases machinery for $220,000 that is considered to last 7 years; it is estimated that at the end of the period it will have a salvage value of$1000. Find: to. The depreciation rate. b. The book value at the end of the sixth year.

Eliseo
4.6
To find the depreciation rate, we can use the formula:

\text{{Depreciation Rate}} = \frac{{\text{{Cost}} - \text{{Salvage Value}}}}{{\text{{Useful Life}}}}

Given:
Cost = $220,000 Salvage Value =$1,000
Useful Life = 7 years

Substituting the values into the formula, we have:

\text{{Depreciation Rate}} = \frac{{220,000 - 1,000}}{{7}}

Simplifying the expression, we get:

\text{{Depreciation Rate}} = \frac{{219,000}}{{7}}

\text{{Depreciation Rate}} = 31,285.71

So, the depreciation rate is $31,285.71 per year. To find the book value at the end of the sixth year, we can use the formula: \text{{Book Value}} = \text{{Cost}} - $\text{{Depreciation Rate}} \times \text{{Number of Years}}$ Given: Cost =$220,000
Depreciation Rate = $31,285.71 Number of Years = 6 years Substituting the values into the formula, we have: \text{{Book Value}} = 220,000 - $31,285.71 \times 6$ Simplifying the expression, we get: \text{{Book Value}} = 220,000 - 187,714.26 \text{{Book Value}} = 32,285.74 Answer: a. The depreciation rate is$31,285.71 per year.
b. The book value at the end of the sixth year is \$32,285.74.

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