Lenny's car is worth $18,000 after 5 years. When the car was new, it sold for $24,000. What is the depreciation rate?

Question

Jaydin Beard

8 December, 04:57

+5

Answers (2)

Know the Answer?

Moises Mahoney · Answer 1

If you doing straight-line depreciation rate

(P-s) : N

(24000-18000) / 5=1200

where p is cost, s is sold or salvage value, N is number of years

Cooper Browning · Answer 2

A=p (1-r) ^t

18000=24000 (1-r) ^5

Solve for r (rate of depreciation)

R = ((18,000:24,000) ^ (1:5) - 1) * 100

R=-5.59 % per year