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4. The MNH Company purchased an asset on January 1, 1995, for $210,000. The estimated life of the asset is ten years; the company uses straight-line depreciation. On December 31, 1997, the net book value of the asset is $156, 000. What was the estimated salvage value?please explain the question in a very "dummified way"

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Answer #1
Cost of Assets On Jan 1 1995 210000
Less: Net Book Value on Dec 31 97 156000
Accumulated Depreciation for 3 years 54000
Annual depreciation (54000/3) 18000
Therefore, the depreciable cost over the estimated life of 10 years will be:
Annual depreciation 18000
Estimated life 10
Total depreciable cost over 10 years of life 180000
Total Initial cost of Assets 210000
Less: Total depreciable cost 180000
Estimated Salvage value at the end of life 30000
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