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the andrews company has just purchased $52,956,000 of plant and equipment that has an estimated useful life of 15 years. the expected salvage value at the end of 15 years is $5,295,600. what will the book value of this purchase (exclude all other plant and equipment) be after its second year of use?

Respuesta :

The purchase's book value will be $3530400.

What does a business purchase mean?

A corporation or organization uses the purchasing process to buy products or services in order to achieve its objectives. Although many businesses make an effort to establish standards for the purchasing process, procedures can differ significantly between firms.

Briefing:

Depreciation expenses = Cost - Salvage value / Expected useful life of the plant and equipment

Depreciation expenses = $52,956,000 - $52,956,000 / 15 years

Depreciation expenses = $52,956,000 - $3530400

Depreciation expenses = $49425600

Book value = Cost - Depreciation expenses for first year

Book value = $52,956,000 - $49425600

Book value = $3530400

Thus,  the book value of plant and equipment after its first year of use is $3530400.

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