A building has an effective age of 15 years and a remaining economic life of 35 years. Using the age-life method, what is the percentage of accrued depreciation?
Correct Answer
A) 30%
Total economic life = 15 + 35 = 50 years. Accrued depreciation = Effective age ÷ Total economic life = 15 ÷ 50 = 0.30 or 30%.
Why This Is the Correct Answer
Total economic life = 15 + 35 = 50 years. Accrued depreciation = Effective age ÷ Total economic life = 15 ÷ 50 = 0.30 or 30%.
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