Problema Solution
solve by building an equation model.
Hi-Tech Home improvements buy a fleet of identical trucks that cost 31,600 each. The company is allowed to depreciate the value of their trucks by $5,110 per year. Company policies dictate that older trucks must be sold once their value declines to $6,050, approximately how many years will they keep these trucks?
Answer provided by our tutors
Look the total cost of buying is 31600 and depriciatoin per year is 5110 per year and salvage value is 6050, formula is
Depreciation in Any Period = ((Cost - Salvage) / Life)
5110=(31600-6050)/x
x=25550/5110
x=5 years.