The price of a High Definition TV purchased by Scranton High School was $2,034. It cost $100 for delivery and $175 for installation. The salvage value at the end of a 5-year life is $250. Using the sum-of-the-years' digits depreciation, calculate the annual depreciation for year 4.
A) $274.53
B) $582.34
C) $212.18
D) $674.09

Question

Quizplus · Accepted Answer

The total depreciable amount is $2,034 + $100 + $175 - $250 = $2,059. The sum of the years' digits for 5 years is 15 (5+4+3+2+1). In year 4, the fraction is 2/15. The depreciation for year 4 is (2/15) * $2,059 = $274.53.

The Price of a High Definition TV Purchased by Scranton