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Engineering Economy Quiz - Deprecation Instructions

1. The document contains an engineering economy quiz with 4 questions about depreciation methods. It asks to calculate depreciation using straight line, sinking fund, Matheson, and SYD methods for various assets over different time periods. 2. The second question asks to find the appraised value of a manufacturing plant using the sinking fund method at 6% interest over 10 and 20 years. 3. The third question provides data on 3 lathe models and asks to calculate total annual depreciation using group and composite methods over 8 and 12 years.

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John A. Ceniza
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619 views1 page

Engineering Economy Quiz - Deprecation Instructions

1. The document contains an engineering economy quiz with 4 questions about depreciation methods. It asks to calculate depreciation using straight line, sinking fund, Matheson, and SYD methods for various assets over different time periods. 2. The second question asks to find the appraised value of a manufacturing plant using the sinking fund method at 6% interest over 10 and 20 years. 3. The third question provides data on 3 lathe models and asks to calculate total annual depreciation using group and composite methods over 8 and 12 years.

Uploaded by

John A. Ceniza
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Engineering Economy Quiz – Deprecation

Instructions:
a. This exam paper consists of (3) three questions. Deadline: 12-15-2020, 3:05pm via gmail
thru class representative.
b. For problem-solving type questions, show your solutions by attaching your answers in
pdf, doc and word file. BOX your final answers with signature.

Name: __________________________ Date/Section: ___________


1. Civil engineer bought a gantry crane for erecting tall buildings. It was invoiced from Japan
CIF (cost, insurance, freight) Manila at P25,000. Brokerage, bank, arrastre fees, customs'
duties, permits, etc. total P120,000. At the end of 10 years, he expects to sell it for P50,000.
Prepare a depreciation schedule for each of the following methods: (a) straight line formula,
(b) sinking fund formula at 12%, (c) Matheson formula, and (d) SYD method.
2. A plant erected to manufacture socks has a first cost of P10,000,000 with an estimated salvage
value of P 100,000 at the end of 25 years. Find its appraised value to the nearest P100 by the
sinking fund method, assuming an interest rate of 6% (a) the end of 10 years; (b) the end of 20
years.
3. Reyes Machine Company owns three different models of lathes whose data are indicated in
the table below.

Model Number Number Owned First Cost Salvage Value Expected Life
A 12 25,000 5,000 8
B 6 12,000 2,000 10
C 4 15,000 3,500 12

One-half of the lathes of each model will be sold after 8 years and the remainder will be replaced
after 12 years. Compute total annual straight-line depreciation charges using (a) the group
depreciation method, and (b) the composite depreciation method. (c) Compute the total annual
depreciation charges for each method and compute the composite life based depreciation.

4. A contractor imported a bulldozer for his job, paying P250,000 to the manufacturer. Freight
and insurance charges amounted to P 18,000; customs', broker's fees and arrastre
services,P8,500; taxes, permits, and other expenses, P25,000. If the contractor estimates the
life of the bulldozer to 10 years with a salvage value of P20,000 determine the book value at,
the end of 6 years, using the (a) straight-line (b) sinking fund formula at (c) Matheson formula
(d) SYD method.

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